London: The World Gold Council has halved its forecast for growth in global gold investment demand in 2026, as purchases of physical gold bars and coins slow despite continued interest from exchange traded funds and central banks.
The council now expects investment demand to finish 2026 around 200 tonnes above its 2025 level, compared with its earlier forecast of growth of 400 tonnes. The revision reflects weaker retail buying and changing investor behaviour as gold prices fluctuate amid uncertainty over the global economic outlook.
According to the council's third quarter Gold Demand Trends report, global investment demand, excluding over the counter activity, reached 479 tonnes during the July to September period. This represented a 14 per cent decline compared with the same period last year.
Demand for gold bars and coins fell 19 per cent year on year to approximately 268 tonnes, marking its lowest quarterly level in four years. The council attributed the slowdown partly to investors becoming more cautious after gold prices remained within a relatively narrow range during much of the quarter.
However, investment through gold backed exchange traded funds continued to support the market. These funds recorded inflows of approximately 211 tonnes during the third quarter, taking their combined gold holdings to a record 4,256 tonnes.
Although ETF inflows were 6 per cent lower than a year earlier, the return to strong buying during the third quarter indicated continued interest from financial investors. European funds led the inflows, followed by North American and Asian funds.
Central banks also remained important buyers. Their net gold purchases reached an estimated 321 tonnes during the third quarter, an increase of 42 per cent compared with the same period in 2025. This was the highest quarterly level since the final quarter of 2024.
The People's Bank of China and the National Bank of Poland were among the largest reported buyers, purchasing 63 tonnes and 40 tonnes respectively. The National Bank of Kazakhstan and the Central Bank of Uzbekistan each added approximately 14 tonnes.
The council said central bank purchases during the first nine months of 2026 reached 675 tonnes, an increase of 6 per cent compared with the corresponding period last year. It expects official sector demand to remain strong and forecasts that full year purchases could at least match the previous year's level.
However, the council noted that a significant share of central bank demand was estimated rather than publicly reported. Officially reported net purchases amounted to 120 tonnes during the third quarter, while the remaining activity was based on estimates of undisclosed transactions.
Jewellery consumption also weakened as high gold prices made purchases less affordable for many consumers. Global jewellery demand declined 17 per cent year on year to 313 tonnes, its weakest third quarter since the council began keeping records in 2000.
India and mainland China, two of the world's largest gold jewellery markets, experienced significant declines. India's jewellery consumption fell 20 per cent to approximately 100 tonnes, while China's demand dropped 22 per cent to 65.7 tonnes.
Despite the decline in the amount of gold purchased, spending on jewellery remained relatively high because of higher gold prices. The value of global jewellery demand increased 2 per cent to $43 billion during the quarter.
The council said consumers were increasingly choosing lighter and smaller jewellery items to manage the higher cost of gold.
Meanwhile, demand from the technology sector provided some support to the market. Overall technology demand increased 3 per cent year on year to 84.8 tonnes, while electronics demand rose 5 per cent to 72.5 tonnes.
The growth was supported partly by increased demand for gold used in electronics linked to artificial intelligence infrastructure, data centres, servers and advanced computing systems. Gold remains an important material in electronic components because of its electrical conductivity and resistance to corrosion.
Despite weaker retail investment, overall global gold demand remained close to record levels. Total demand, including over the counter activity, reached 1,369 tonnes during the third quarter, down just 1 per cent from a year earlier.
For the first nine months of 2026, global demand reached 3,881 tonnes, almost matching the 3,884 tonnes recorded during the same period in 2025. The value of global gold demand during the third quarter increased 22 per cent year on year to $188 billion, while its value during the first nine months reached a record $566 billion.
The increase in value reflects the higher price of gold, even as the physical volume of demand remained relatively stable.
Gold supply also remained relatively stable. Mine production increased 3 per cent year on year to 1,071 tonnes during the third quarter, reaching a record for the period. However, recycled gold supply declined 8 per cent to approximately 315 tonnes, leaving total supply 1 per cent lower than a year earlier.
Gold prices have experienced significant fluctuations this year. The metal reached an intraday record of approximately $5,595 per ounce on January 29, supported by strong demand for gold as a safe haven and concerns about geopolitical and economic uncertainty.
Prices subsequently came under pressure as expectations of higher interest rates, a stronger US dollar and changes in investor positions affected the market. Gold reached a one year low on October 30 before recovering by more than 2 per cent on November 2.
However, renewed pressure emerged on November 3, with spot gold falling 0.9 per cent to $3,913.62 per ounce by 0653 GMT. Higher oil prices, inflation concerns and expectations that interest rates could remain elevated contributed to the decline.
The latest developments highlight the changing nature of the global gold market. Although retail investors are purchasing fewer bars and coins, continued ETF inflows and central bank buying are providing support.
The World Gold Council's revised forecast therefore points to slower growth in investment demand rather than a broad decline in global interest in gold. Gold prices, interest rate expectations and central bank purchasing activity are likely to remain important factors shaping the market during the final months of 2026.