Gold demand hits record highs as investors seek refuge from market volatility

By Newsdesk

November 04 2025
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Global gold demand surged to record levels in the September quarter as investors sought safety amid volatile markets and growing geopolitical uncertainty, according to the World Gold Council’s Q3 2025 Gold Demand Trends report.

Gold demand hits record highs as investors seek refuge from market volatility

Quarterly gold demand — including over-the-counter (OTC) transactions — reached 1,313 tonnes (t), equivalent to US$146 billion in value terms, marking the highest quarter for gold demand on record.

The report showed that investment demand was the key driver, rising 47 per cent year-on-year (y/y) to 537t and accounting for 55 per cent of total net gold demand. The increase was attributed to “a powerful combination of an uncertain and volatile geopolitical environment, US dollar weakness and investor FOMO as the price climbed higher.”

Investors continued to pour into physically backed gold ETFs for a third consecutive quarter, adding 222t (US$26 billion) in inflows. Year to date, global ETF holdings have grown by 619t (US$64 billion), led by North American funds (346t), followed by Europe (148t) and Asia (118t).

Bar and coin investment also strengthened, up 17 per cent y/y to 316t, with significant contributions from India (92t) and China (74t).

Conversely, jewellery demand fell 19 per cent y/y in Q3, weighed down by record-high prices. Although both India and China recorded quarter-on-quarter growth due to seasonal trends, consumption remained weaker than a year earlier.

Central bank demand also strengthened, with net purchases of 220t in Q3 — up 28 per cent on Q2 and 10 per cent y/y — despite the record-high gold price. Year-to-date central bank net buying totalled 634t, remaining above pre-2022 levels.

On the supply side, total gold supply reached a quarterly record of 1,313t, up 3 per cent y/y, driven by a 2 per cent rise in mine production to 977t and a 6 per cent increase in recycling to 344t.

Louise Street, Senior Markets Analyst at the World Gold Council, said gold’s climb towards US$4,000 per ounce underscored the strength of demand drivers throughout 2025.

“Gold’s climb towards US$4,000/oz in the third quarter underscores the strength and persistence of the factors that have been driving demand throughout the year,” Ms Street said.

“Heightened geopolitical tensions, stubborn inflationary pressures and uncertainty around global trade policy have all fuelled appetite for safe-haven assets as investors look to build resilience in their portfolios.”

She added that gold’s outlook remains optimistic, supported by ongoing US dollar weakness and lower interest rate expectations.

“The outlook for gold remains optimistic, as continued US dollar weakness, lower interest rate expectations, and the threat of stagflation could further propel investment demand. Gold has set record after record this year, and the current environment suggests there could be more upside gains for gold. Our research indicates the market is not yet saturated, and the strategic case to hold gold remains firmly in place.”

Shaokai Fan, Head of Asia (ex-China) and Global Head of Central Banks at the World Gold Council, said Australia was among the markets showing strong investment growth.

“Australian investment demand for physical bars and coins rose 30 per cent y/y, marking the second biggest y/y jump in demand since the Q1 2025 record of 45 per cent, signalling a deepening strategic interest in gold among Australian investors,” Mr Fan said.

“Quarterly jewellery demand in Australia fell 10 per cent year-on-year, around half the global rate of decline (-19 per cent), indicating a comparatively resilient local jewellery market.”

Together, these trends lifted total Australian gold consumption by 12 per cent y/y to 5t in Q3, he said.

Mr Fan noted that locally listed gold ETFs added 7.2 tonnes in 2025 to date, lifting assets under management (AUM) by A$1.1 billion (US$724 million) to a total of A$9 billion (US$6.1 billion) by the end of September.

“The surge in global ETF holdings marks a major structural demand wave for gold, joining renewed central bank buying and growing emerging market investment,” he said.

“Despite the recent pull back, we believe gold’s fundamental drivers will continue to support its accumulation in portfolios.”

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