A recovery in gold demand is likely despite the largest decline in two years, according to the World Gold Council.
Overall gold demand dropped 10% on last year according to a recent report released by the group showing demand trends for Q3.
Total consumer demand fell 26% on last year as gold jewellery demand was down 21%. But in spite of this, the report shows Q4 started on a stronger footing and should see a degree of recovery.
Alistair Hewitt, head of market intelligence at the World Gold Council, said that in October there was buoyant demand from bar and coin investors from around the world when the price dipped.
Hewitt told Professional Jeweller: “We also saw buoyant demand in the jewellery space for investors buying jewellery as an investment purpose. We also saw a very, very good October, especially in India.”
The strong start to Q4 is being attributed to a dip in gold price in October coinciding with Diwali, which is widely celebrated both in India and by a large population in the UK.
But, the report stated that it would not be a clear recovery. Hesitant consumers in the UK and Europe mean that pressures remain and Hewitt added: “The high price is going to be a factor that people will have to battle with at some point over the next 12 months.”