Iranian demand for gold jewellery surged to a near two-year high in the third quarter as sentiment improved following Tehran’s signing of a nuclear deal with world powers in July.
The surge in Iranian demand for the precious metal came amid falling demand in other parts of the Middle East as oil prices slumped.
Global demand for gold in the third quarter rose 8 per cent year on year to 1,120.9 tonnes, its highest level in two years, according to figures released on Thursday by the World Gold Council.
Consumer demand for gold grew following a price dip prompted by exchange-traded fund outflows in July, with prices rebounding as institutional investors resumed purchases.
Bullion for immediate delivery edged up 0.1 per cent to US$1,087.40 an ounce in Singapore yesterday, according to Bloomberg, just above the $1,077.40 an ounce level on July 24, the lowest since 2010.
Demand for gold jewellery in Iran jumped 40 per cent to 12.8 tonnes in the three months to the end of September, making it one of the fastest-growing jewellery markets in the world, according to the council.
“Consumer sentiment was boosted by the signing of the nuclear deal, an affect that was further magnified by the tumbling gold price,” the council noted, despite the introduction of a 9 per cent value-added tax in Iran in late March.
Gold jewellery demand across the Middle East grew 8 per cent year on year to 55.5 tonnes, even as demand fell sharply in some parts of the region after lower oil prices.
Demand in Kuwait fell 15 per cent year on year to 2.2 tonnes in the third quarter. UAE demand dropped 5 per cent to 9.9 tonnes in the quarter.
However, the UAE’s Central Bank confirmed that it added five tonnes of gold to its reserves between April and September, placing the UAE among the top 100 holders of gold worldwide.
Gold purchases by central banks rose to 175 tonnes during the quarter, just shy of the record level of 179.5 tonnes in the third quarter last year.
jeverington@thenational.ae
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