The World Gold Council (WGC) has reported that global gold demand surged to unprecedented levels in 2023, driven by geopolitical tensions and economic concerns, particularly in China.
According to the WGC’s Gold Demand Trends Full Year 2023 report, total gold demand reached a record 4,899 tons, representing a 3% increase of 158 tons compared to the previous year.
The surge in demand was attributed to robust activity in the over-the-counter (OTC) market and sustained purchases by central banks. The People’s Bank of China emerged as the largest buyer, acquiring 225 tons of gold and increasing its reserves to 2,235 tons.
Both central banks and retail investors contributed to the heightened demand, with central bank purchases exceeding 1,000 tons for the second consecutive year. This surge led to a peak gold price of $2,100 per ounce in December 2023.
Key drivers of gold demand included geopolitical conflicts such as the Russia-Ukraine conflict and Israel-Hamas tensions, along with the economic slowdown in China.
The significant acquisitions of gold by central banks not only bolstered reserves but also raised awareness among investors, prompting some individuals to consider gold as a personal investment.
Looking ahead, the WGC anticipates that gold purchases may not reach the levels seen in 2023. However, a potential decline in inflation could prevent a significant drop in demand.
In contrast, Vietnam experienced a 6% decline in gold demand, falling from 59.1 tons in 2022 to 55.5 tons in 2023.
