India remained gold’s biggest consumer in 2012, World Gold Council (WGC) figures show. Prospects of import duty increases in India from January 2013, prompted advanced buying, pushing demand up 41% quarter-over-quarter. Chinese demand growth was flat year on year, possibly reflecting optimism by Chinese investors that the country managed to avoid a hard landing.
While gold demand reached a record US$236.4bn last year, investment demand softened as purchasing managers indices, employment data and measures of business confidence illustrate the global recovery remains on track. Declines from investments were more than compensated by increases in official sector purchases, which reached a 48-year high, and in jewellery consumption. For 2013, the WGC claims the recent weakness in the gold price might persist for as the improved risk appetite prompts investors to rotate to more cyclical assets.
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