Global gold demand in the first quarter of 2019 reached 1,053.3 tons, 7 percent more than the same period the year before, while gold-backed ETFs grew by 49 percent to reach 40.3 tons, according to data published by the World Gold Council.

«The beginning of 2019 saw a sharp recovery in investor sentiment in both the equity and debt markets, but appetite for gold remained solid. In Q1, central banks continued to increase their holdings of gold, while ETFs also saw an increase in inflows compared with the first quarter of 2018», Alistair Hewitt, Head of Market Intelligence at the World Gold Council, said.

«European investment in ETFs hit a record high and this quarter's figures suggest that the factors that are driving the investment – negative yields on Eurozone sovereign debt, geopolitical uncertainty and financial market volatility – will continue to underpin investment demand.»

Central Bank Buying

Central banks added 145.5 tons to global reserves, the largest first-quarter increase since 2013 and 68 percent higher than the first quarter of 2018. Nine countries added more than 1 ton of gold to their reserves, with Russia remaining the biggest buyer, adding 55.3 tons during the quarter.

In Asia, gold buying among central banks remained strong. China added 33 tons of gold, marking four consecutive months of gold accumulation, while India’s gold purchases grew for 13 consecutive months, adding 8.4 tons in Q1. Additionally, Kazakhstan added 11 tons while the Kyrgyz Republic added 1 ton in Q1.

«We believe that central bank gold buying in this region will continue to be robust as more banks tap into gold’s safety, liquidity and return generating features,» Shaokai Fan, Director, Central Banks and Public Policy, World Gold Council, said in an email to finews.com.