Total gold demand, including OTC investment and stock changes, remained steady at 1,269 tonnes during the second quarter. This brought total demand for the first half of 2026 to 2,522 tonnes, representing a 2% year-on-year increase. Gold-backed exchange-traded funds (ETFs) experienced selling pressure in Q2, recording net outflows of 45 tonnes. These moderate outflows were driven by weaker gold prices and, particularly in North America, higher inflation and interest rate expectations alongside a stronger US dollar.

Key Highlights

Bar and coin investment remained stable year-on-year at 307 tonnes in the second quarter. This reflected a return to more normal demand levels following two exceptionally strong quarters.

Gold-backed ETFs came under selling pressure during Q2, with global holdings declining by 45 tonnes. The decrease resulted from combined outflows from both North American and Asian-listed funds.

Central banks significantly increased their gold purchases during the quarter. Following a noticeable slowdown in the first quarter, buying activity recovered sharply and returned to levels typically seen over the past four years.

Gold jewellery demand fell to 278 tonnes in Q2, marking the lowest quarterly level since the pandemic. Despite the decline in volumes, consumer spending on gold jewellery increased by 14% year-on-year to US$40 billion, as higher gold prices led consumers to allocate a larger share of spending toward gold jewellery.

Total gold supply remained broadly unchanged compared to the same period last year. A 2% increase in mine production offset a 6% decline in gold recycling, as lower quarter-on-quarter gold prices discouraged consumers from selling old gold jewellery.

Outlook

Investment is expected to remain the primary source of gold demand growth for the rest of 2026, with increasing support from Asian investors and broader OTC activity. Central banks are also expected to continue making significant gold purchases. Elevated gold prices are likely to keep jewellery demand volumes under pressure while prompting only a limited increase in mine production and recycled gold supply.