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The crown crisis had a drastic impact on the gold trade. On the one hand, the demand for gold coins and gold bars, as well as for securities in which gold is stored, increased significantly from July to September. On the other hand, the demand for gold jewelry plummeted due to the numerous crown locks in the spring. This comes from a report from the World Gold Council (WGC) industry association. The bottom line is that global demand for gold fell 19% year-on-year to 892 tons in the third quarter.
According to the trade association, demand has not been as weak since the third quarter of 2009. At that time, the consequences of the severe financial and economic crisis were weighing on the world economy.
Now the blocking restrictions have apparently taken away the desire to buy. Furthermore, the price of gold has risen by about 20% since the beginning of the year; in August the price of gold had reached a record high of 2075 US dollars per troy ounce (31.1 grams). So gold jewelry became more expensive. According to the report, jewelry demand decreased 29% year-over-year to 333 tons in the third quarter. The largest declines occurred in China and India.
At the same time, gold was in demand as a safe haven among investors. In terms of investment demand, the WGC recorded a 21% year-over-year increase for the third quarter. In the three months to the end of September, investors around the world purchased 222.1 tons of gold bars and coins and an additional 272.5 tons via physical gold-backed “Exchange Traded Commodities” (ETCs).
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