World Gold Council: Q2 2013 Gold Demand Trends

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The World Gold Council has released its Gold Demand Trends Q2 2013 report today, which is the leading industry resource for data and opinion on world-wide gold demand. The quarterly publication examines demand trends by sector and geography. For the full report visit: http://www.gold.org/media/press_releases/archive/2013/08/gdt_q2_2013_pr/

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  • Slide 7 – Total gold demand tableThe demand table shown here gives a more detailed breakdown of demand into its key sectors.Jewellery: Grew 11% in Q4 largely due to to a revival in Indian demand in the second half of the year. Annual demand was 3% lower. India again the driver - a very weak first half weighed on the annual total. India's year of two halves is discussed in detail in the report. Investment: Saw declines of a similar magnitude in the Q4 and full year numbers. Bar and coin demand softened from exceptional demand seen in 2011, but still holds well above the 5-year average. Technology: A combination of high average prices, relatively weak demand from key consumer markets and de-stocking towards the end of the year contributed to a 3% decline in Technology demand.Official sector: Gold's diversification benefits drove net central bank purchases to a 48-year high of 534.6 tonnes.Gold buying is still most prevalent among the central banks of emerging markets.
  • Slide 10 – Jewellery attracts greater values Jewellery demand echoed developments in India, the largest market accounting for 29% of total demand. Price-related declines in demand volumes were seen across most markets with a handful (including Russia, Turkey and Japan) generating counter-trend growth.Demand in US dollars reached a new annual record of US$102.4bn as consumers continued to allocate ever greater sums to gold jewellery.The inference that gold jewellery is as desirable as ever is confirmed by data from some Western markets, where growth in silver consumption is being fuelled by demand for gold-plated silver pieces.
  • Slide 17 – Total gold supply tableFourth quarter supply was unchanged year-on-year as a drop in recycling (predominantly in India) counterbalanced a 2% increase in mine productionAnnual supply contracted by 1%. Recycling was again the primary reason for the decline as mine output was unchangedProducer de-hedging of 20 tonnes more than reversed the 11.3 tonnes of net hedging from 2011 but absolute volumes remain negligible
  • World Gold Council: Q2 2013 Gold Demand Trends

    1. 1. Gold Demand Trends Second Quarter 2013 15th August 2013
    2. 2. Disclaimer 2 This presentation is provided solely for general information and educational purposes. It is not, and should not be construed as, an offer to buy or sell, or as a solicitation of an offer to buy or sell, gold, any gold related products or any other products, securities or investments. It does not, and should not be construed as acting to, sponsor, advocate, endorse or promote gold, any gold related products or any other products, securities or investments. This presentation does not purport to make any recommendations or provide any investment or other advice with respect to the purchase, sale or other disposition of gold, any gold related products or any other products, securities or investments, including without limitation, any advice to the effect that any gold related transaction is appropriate for any investment objective or financial situation of a prospective investor. A decision to invest in gold, any gold related products or any other products, securities or investments should not be made in reliance on any of the statements in this presentation. Before making any investment decision, prospective investors should seek advice from their financial advisers, take into account their individual financial needs and circumstances and carefully consider the risks associated with such investment decision. While the accuracy of any information communicated herewith has been checked, neither the World Gold Council nor any of its affiliates can guarantee such accuracy. In no event will the World Gold Council or any of its affiliates be liable for any decision made or action taken in reliance on the information in this presentation or for any consequential, special, punitive, incidental, indirect or similar damages arising from, related to or connected with this presentation even if notified of the possibility of such damages. Expressions of opinion are those of the author and are subject to change without notice. World Gold Council | Gold Demand Trends Second Quarter 2013 | August 2013
    3. 3. Summary 3 • Second quarter gold demand of 856.3t (US$39.0bn) was down 12% compared with Q2 2012 • Demand for jewellery was 575.5t (US$26.2bn) in the quarter, up 37% on last year. This was the highest figure since Q3 2008, and the highest second quarter figure since Q2 2007 • The net outflow from ETFs was 402.2t (US$18.3bn). However that was more than compensated by bar and coin investment, which saw inflows of 507.6t (US$23.1bn). • Net central bank purchases totalled 71.1t (US$3.2bn), 57% down on what was a record- breaking quarter a year ago. Central banks have now been net purchasers of gold for ten consecutive quarters • Demand in the technology sector was stable once again, totalling 104.3t, a rise of 1% on last year • Mine production in the quarter was 4% higher than a year ago, at 732.2t. Recycling fell 21%, leading to a total supply that was 6% lower than a year ago World Gold Council | Gold Demand Trends Second Quarter 2013 | August 2013
    4. 4. Demand (tonnes) Q2'12 Q2'13* YoY% 2011 2012 YoY% Jewellery 420.8 575.5 37% 1,975.1 1,896.1 -4% Technology 103.3 104.3 1% 451.7 407.5 -10% Investment 285.9 105.4 -63% 1,703.8 1,534.7 -10% Official sector purchases 164.5 71.1 -57% 456.8 544.4 19% Gold demand 974.6 856.3 -12% 4,587.4 4,382.7 -4% Gold demand (value, US$mn) 50,430 38,952 -23% 231,783 235,171 1% Total gold demand Note: * Provisional. Source: Thomson Reuters GFMS, LBMA, World Gold Council 4World Gold Council | Gold Demand Trends Second Quarter 2013 | August 2013
    5. 5. Surge in jewellery and investment countered by ETF outflows 5World Gold Council | Gold Demand Trends Second Quarter 2013 | August 2013
    6. 6. India and China: global powerhouses 6World Gold Council | Gold Demand Trends Second Quarter 2013 | August 2013
    7. 7. Supply (tonnes) Q2'12 Q2'13* YoY% 2011 2012 YoY% Mine production 706.9 732.2 4% 2,838.8 2,862.5 1% Net producer hedging -8.0 -15.0 - 10.8 -40.2 - Total mine supply 699.0 717.2 3% 2,849.6 2,822.3 -1% Recycled gold 389.0 308.3 -21% 1,649.4 1,590.7 -4% Total supply 1,087.9 1,025.5 -6% 4,499.0 4,413.0 -2% Gold price (London PM fix, US$/oz) 1,609.5 1,414.8 -12% 1,571.5 1,669.0 6% Total gold supply Note: * Provisional. Gold prices are averaged over the period they refer to. Source: Thomson Reuters GFMS, LBMA, World Gold Council 7World Gold Council | Gold Demand Trends Second Quarter 2013 | August 2013
    8. 8. World Gold Council 10 Old Bailey, London EC4M 7NG United Kingdom T +44 20 7826 4700 F +44 20 7826 4799 W www.gold.org Thank you
    9. 9. Ease of navigation, several views available World Gold Council research – simple to access 9 Research app for investors – available on iPad / iPhone • To download or subscribe to our gold investment research studies: • www.gold.org/investment/research • Or click on the link below: • Or scan:

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