Gold ETFs were hardest-hit by the slide in demand: the 109.1 tons of the precious metal bought are only a fraction of demand in the first quarter of previous year.
"Having plateaued in recent years, mine production will soon enter a period of decline".
Consumption Grows 15% Year-On-Year To Hit 124 Tonnes Gold is regaining its sheen after a year of subdued demand. However, the market is wary of the forthcoming decision on GST and this will likely weigh on demand until the government's final decision, due for implementation in early July.
World Gold Council The World Gold Council is the market development organisation for the gold industry.
Gold is a major money earner for the UAE.
Indians buy more than two-thirds of gold with cash. "Hence the demand is consistent in the region", said Abdullah.
In April, Reuters reported that the Turkish central bank is to be given its first option to buy locally mined gold.
That's a big fall, but as the WGC points out, Q1 2016 was the strongest ever quarter for gold demand. "People are uncertain, it is generally good for gold", said Mulligan. Inflows into Exchange Traded Funds (ETFs) totalled 109t which, although solid, were nonetheless a fraction of last year's near-record inflows.
Continued remonetisation by the Reserve Bank of India (RBI) buoyed consumer sentiment encouraging demand ahead of the wedding season, the report said.
On the other hand, investment in bar and coin was healthy and increased 9% at 290 tonnes, while the demand firmed a little in technology as well as jewellery sector.
Investment in gold bars and coins was up 9% year-on-year, largely driven by China where retail investment was up 30%, breaching 100t for only the fourth time on record.
Central bank demand for gold continued to slow: 76.3t were added to reserves.
Jewellery gold demand in Iran jumped 27 percent in 1Q17 year-on-year to a four-year high of 12.9 tons, helped by an improving economy, World Gold Council said.
The group also notes that European investors accounted for most ETF inflows in Q1, a trend that began in the second half of 2016.
Jewelry remained relatively weak in historical context and it was steady at 480.9 tons because of rising gold prices, it said.
"The main reason for the marginal increase in jewellery demand is gains in India".
The demand for jewellery in the first quarter was slightly up at 481 tonnes. As a percentage of total reserves, however, China's gold remains comfortably above 2%, reaching as much as 2.4% as the gold price rose during Q1. Demand from general industry rose one per cent to 12.1 tonnes, but dentistry demand fell five per cent to 4.3 tonnes.