The World Gold Council today revealed structural shifts in global demand for the yellow metal during the first quarter of 2026, at a time when oil prices continue to rise for the eighth consecutive day as a result of the blockade of the Strait of Hormuz and the strain on Iranian supplies.
Central banks added 244 tonnes of gold to global reserves during the first quarter of 2026, exceeding the levels of the previous quarter and the five-year average, despite sales from some entities, including banks in Turkey, Russia and the State Petroleum Fund of the Republic of Azerbaijan (Sovaz), according to the World Gold Council's report.
The World Gold Council's Q1 2026 Gold Demand Trends report showed that total quarterly demand for gold, including over-the-counter (OTC) trading, increased by 2% year-on-year to 1,231 tonnes, and despite this limited growth in quantities, total demand jumped to an unprecedented US$193 billion, up 74% year-on-year, driven by record price levels.
Globally, retail investors were attracted by the strength of gold's price momentum and its safe-haven role, which contributed to a 42% year-on-year increase in demand for bullion and currencies to 474 tonnes.
Demand in China jumped 67% to a record 207 tonnes, surpassing the previous quarterly figure of 155 tonnes recorded in the second quarter of 2013.
Other Asian markets, including India, South Korea and Japan, saw a clear increase in bullion and currency purchases, a sign of a structural shift in demand patterns, with demand in the United States up 14% and Europe by 50%.
Gold Funds Maintain Momentum
In terms of gold-backed ETFs, demand remained positive during the first quarter with holdings rising by about 62 tonnes, supported by Asia-listed funds that added 84 tonnes, but outflows in March, especially from US funds, limited the strength of growth.
Demand for jewellery fell 23% year-on-year to 300 tonnes, with broad declines in China (-32%), India (-19%) and the Middle East (-23%). However, the total value of demand increased, reflecting continued spending despite record prices, with part of the demand shifting towards bullion and currencies.
Supply at record levels
Total gold supply increased 2% year-on-year to 1,231 tonnes, with mine production hitting a new record high in the first quarter, while recycling increased by only 5% despite higher prices, reflecting a limited supply response.
Oil Rises
In another context, oil prices jumped on Wednesday, as Brent crude rose to $111.78 per barrel, driven by Washington's adherence to the blockade of Iranian ports and the Strait of Hormuz.
Analysts believe that prolonged supply disruptions will exacerbate global market turmoil.
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