Eric Sepanek
SBC Founder
Eric Sepanek is the founder of Scottsdale Bullion & Coin, established in 2011. With extensive experience in the precious metals industry, he is dedicated to educating Americans on the wealth preservation power of gold and silver.
Total gold consumption stretched to an all-time high of 4,972 tons in 2024, primarily driven by insatiable central bank demand and a rapidly growing retail appetite. National investors accumulated more than 1,000 tons for the third year straight, reinforcing the global transition into physical gold. World Gold Council (WGC) analysts emphasize the role economic volatility and geopolitical uncertainty play in the yellow metal’s years-long rally while suggesting these foundational catalysts are unlikely to change.
The Spread of 2024 Gold Consumption
Gold prices achieved 40 all-time highs throughout its 2024 surge, underscoring its bullish momentum. However, even consistently higher prices weren’t enough to dampen gold demand, which nearly reached 5,000 tons, shattering records and extending a long-term gold binge. Although demand by tonnage was only up 1%, gold consumption by dollar value climbed by 23%, reaching $382 billion.
Here’s a breakdown of gold demand by source:
Central Banks
Governments gobbled up 1,044.60 tons, dropping only 1% from 2023 levels, pushing central bank demand north of 1,000 tons for the third consecutive year. Once again, emerging economies led the charge into gold, with Poland, India, Turkey, and China topping the leaderboard.
Investments
Investments, including paper and physical gold, landed a four-year high at 1,180 tons, representing a 25% surge from the prior year. Following years of gold ETF outflows, 2023 and 2024 saw a considerable influx. Interestingly, official coin purchases fell by 31% as demand for gold bars rose by 10%, possibly resulting from dealer premium increases.
Jewelry
The gold jewelry industry suffered the largest loss in demand, as annual purchases fell to 1,877 tons, an 11% drop from 2023. The yellow metal’s sustained price increases pushed many buyers out of the market, leading to smaller purchases. Despite the drop in tonnage demand, higher prices drove a 9% increase in total dollar spending on gold jewelry, reaching $144 billion.
The Supply Side of the Equation
Mine production saw minimal growth in 2024, rising less than 1% to 3,661.2 tons. Meanwhile, recycled gold surged 11%, driven by technological advancements and increased industry focus. Total gold supply matched global gold demand head-on at 4,974.5 tons, a 1% increase from the previous year. Gold’s steady upward price movement throughout 2024 reflects the market’s tight supply and demand balance. This parity provides stable value while supporting continued pressure.
Macroeconomic & Geopolitical Drivers
The motivations behind distinct sources of gold demand are nuanced, but the core drivers pushing investors away from traditional assets and into safe havens are clear.
Gold’s role as a hedge amidst rising market volatility and geopolitical risk most likely explains its remarkable performance.– According to the World Gold Council
National, institutional, and retail investors are navigating an increasingly turbulent market marked by economic instability and geopolitical tensions. Amid this uncertainty, gold is emerging as the go-to financial lifeboat, helping investors stay afloat.
Demand to Remain Strong in 2025
Analysts at WGC anticipate central bank demand to continue pushing gold prices higher in 2025, supported by renewed retail investments. The industry thought leader doesn’t provide estimates, but UBS has projected national consumption to reach 900 tons, indicating sustained inflows from central banks.
Rising demand has fueled bullish gold price forecasts for 2025, with many experts targeting $3,000 or higher. Gold is steadily approaching that milestone, and—just like in 2024—the strong buying from central banks could push analysts to revise their forecasts even higher.