Gold demand shrinks in 2020 on virus fallout: industry

Gold demand shrank 14 percent last year as the coronavirus pandemic sparked record falls in jewellery purchases and as strong investor interest sent prices to all-time highs, industry data showed Thursday.

Overall demand for the precious metal hit the lowest level since the global financial crisis in 2009, at 3,759.6 tonnes, the World Gold Council (WGC) said in its annual report.

At the same time, gold prices hit record highs above $2,000 an ounce, with the commodity benefitting from its status as a haven investment in times of economic uncertainty.

“Jewellery demand in 2020 dropped to its lowest annual level on record, decimated by the combination of the global pandemic — with its resultant market lockdowns — and record high gold prices at a time of economic slowdown,” the WGC said.

Demand for gold jewellery slumped 34 percent to a record-low 1,411.6 tonnes from 2019.

“In a tumultuous year for the gold market, investment was one of the notable positives,” the report added.