The global gold demand dropped to its lowest level since 2008 in the first quarter of this year, the World Gold Council said Thursday.
The latest report by the council revealed that global demand for gold fell 7 percent year-on-year to reach 973.5 tons.
"The main cause was a fall in investment demand for gold bars and gold-backed Exchange-Traded Funds (ETFs), partly due to range-bound gold prices," the council said.
The total gold investment demand — ETFs inflows, and bar and coin demand — was 27 percent lower compared to the same period last year.
"China, Germany and the U.S. drove weakness in bar and coin investment," it said.
The report showed that official gold reserves reached the highest first quarter level, jumping 42 percent annually to 116.5 tons in the first three months of the year.
"Net purchases have become more concentrated since the 2013 peak. Russia, Turkey and Kazakhstan collectively account for nearly 50 percent of net purchases over the last five years," it said.
The global jewellery demand was stable at 487.7 tons as weaker demand in India compensated growth in China and the U.S.
The demand for gold in technology continued to rise for the sixth consecutive quarter.
"Technology demand extended its recent upward trend, growing 4 percent year-on-year to 82.1 tons," according to the council.
The report showed that the global gold supply rose 3 percent from January to March, compared to the same period last year, owing to a modest increase in producer hedging.
Gold demand in Turkey
Turkey was the second largest net buyer of gold after Russia.
"[Official] gold reserves grew by 29.8 tons in the first quarter, to reach 231.9 tons," the report read.
Turkey's bar and coin demand bounced back in the first three months of the year after a quiet end in 2017.
"Turkish investors turned to gold to protect some of their wealth," it said.
The country recorded the strongest jewellery demand growth of all markets in the first quarter.
The demand for jewellery in Turkey increased 19 percent to 9.9 tons, despite higher local price of gold.
"In value terms, demand increased by 34 percent year-on-year to 1.6 billion liras – above the five-year quarterly average value of 1.4 billion liras," the council said.