Global demand for gold amid the global economic downturn has decreased in the second quarter of this year by 7%, according to World Gold Council (WGC). Falling demand for precious metal has occurred, in particular as a result of its reduced demand in India and China, experts say.
According to the WGC, the demand for gold as an investment tool, as well as for gold jewelry in India has fallen in a year by 38% to 181.3 tonnes, while in China it decreased by 7% to 144.9 tonnes.
Nevertheless, global demand for precious metals remained relatively stable in financial terms. In the second quarter of this year it amounted to $51.2 billion compared to $51.6 billion during the same period in 2011.
In 2011, the increase in gold prices reached nearly 10%, but in the second quarter of this year the cost of metal has fallen by 4%.
Experts call the debt crisis in Europe and the acceleration of inflation in different countries as main factors supporting the value of gold, which is regarded by investors as a more reliable alternative to volatile currencies and subject to severe fluctuations in shares of companies.
Alex Shishlo, Editor in Chief of the European Bureau, Rough&Polished
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