(Mike Maharrey, Money Metals News Service) Gold demand was steady in the third quarter despite consistent pressure from rising interest rates and inflation worries.
Total demand in Q3 was 1,369 tonnes, a modest 1 percent decline year-on-year. That drove year-to-date demand to 3,881 tonnes, virtually identical to last year’s 3,884-tonne record through the same period.
In value terms, third-quarter demand totaled $188 billion, a 22 percent increase year-on-year. Demand value through the first three quarters came in at a record $566 billion.
Central Bank Gold Buying
Central banks continued to support the gold market in Q3 even as prices pressured investment and jewelry demand.
Central banks globally purchased an estimated 321 tonnes of gold in the third quarter. That’s about 100 tonnes more than the five-year quarterly average of 227 tonnes.
China and Poland were the biggest gold accumulators. Russia was the biggest seller, as it tapped its extensive gold reserves to support its wartime economy.
The World Gold Council confirmed 120 tonnes of reported central bank gold buying and estimated an additional 201 tonnes of unreported buying. According to the World Gold Council, “Unreported activity accounted for around 63 percent of the quarter’s demand, continuing the pattern evident since 2022.”
China likely accounts for a significant amount of unreported gold buying. As Jan Nieuwenhuijs reported, the People’s Bank of China is secretly buying large amounts of gold off the books. According to data parsed by the renowned Money Metals researcher, the Chinese central bank currently sits on more than 5,000 tonnes of monetary gold in Beijing – more than TWICE what Chinese officials publicly admit.
Year to date, central banks have purchased 675 tonnes of gold, a 6 percent increase over the same period in 2025.
The World Gold Council noted that central bank buying started the year “muted” but picked up as the gold price dipped. However, WGC analysts don’t think the falling price was the main factor driving purchases.
“Although this moderation may have supported purchases at the margin, prices remained historically elevated, suggesting that longer-term strategic considerations, such as diversification and risk management, have remained the primary driver of demand.”
Investment Demand
Total investment demand, excluding the over-the-counter (OTC) market, came in at 479 tonnes, a 14 percent decline from last year’s exceptionally strong Q3 level.
It was a tale of two sectors. ETF flows increased, even as bar and coin demand dipped.
Physical bar and coin demand fell by 19 percent year-on-year to 268 tonnes, a four-year low. According to the World Gold Council, many investors sat on the sidelines over the last three months as they “waited for a clearer price trend to emerge.”
Demand value held steady at $37 billion year-on-year, despite the steep volume decline.
Chinese investors continued to support the physical gold market, even as Western investors showed little interest.
Chinese bar and coin demand rose 7 percent year-on-year in Q3 to 79 tonnes. Year-to-date demand of 393 tonnes ranks as the highest on record, 11 percent above the previous high set in 2013.
Chinese physical gold demand is even more impressive in value terms. Year-to-date spending of $59 billion already exceeds every full year in the World Gold Council data series. Q3 demand alone surged by 32 percent to 11 billion.
Indian demand was muted at 55 tonnes, down 40 percent year-on-year. Higher prices were exacerbated by an increase in the gold import duty in May.
U.S. bar and coin demand fell 40 percent year-on-year to 8 tonnes. It was the weakest quarter for coin and bar demand since Q4’19.
Meanwhile, gold ETFs globally reported inflows of 211 tonnes. That drove ETF gold holdings to a record 4,256 tonnes.
In value terms, ETF gold inflows totaled $31 billion, driving total assets under management up by 9 percent quarter-on-quarter.
All three regions reported ETF gold inflows in Q3. European-listed funds led the way, adding 92 tonnes of gold to their holdings. It was the largest quarterly increase since Q1’22.
North American funds and Asian funds added 81 and 34 tonnes, respectively.
ETFs are a convenient way for investors to play the gold market, but owning ETF shares is not the same as holding physical gold.
OTC and stock flows capture less visible elements of investment demand, along with any statistical residual from the data. World Gold Council analysts estimate OTC demand was 143 tonnes in Q3. That was 43 percent higher year-on-year, but less than half of the elevated Q2’26 level.
Jewelry Demand
Higher prices continue to create significant headwinds for the gold jewelry market.
Global gold jewelry demand fell 17 percent to 313 tonnes, the weakest third quarter in the World Gold Council’s data series dating back to 2000.
It was the 13th straight quarterly drop in gold jewelry demand.
On the bright side, gold jewelry demand was up 12 percent from last quarter, led by seasonal recovery in both Chinese and Indian demand.
It’s not so much that consumers are spurning gold jewelry. It’s just grown significantly more expensive.
In fact, spending was up $43 billion in Q3 even as volumes dipped.
That continues the 2026 trend. Through the first three quarters, jewelry demand volumes fell 19 percent to 889 tonnes, while value increased 15 percent to almost $130 billion.
Gold in Tech and Industry
Demand for gold in industry and technology applications was 84.8 tonnes, a modest 3 percent year-on-year gain.
A 5 percent increase in gold demand for use in electronics pushed overall industrial demand higher.
According to the World Gold Council, “Strong AI infrastructure investment was a growth area for gold usage, while continued thrifting and substitution in lower-value applications further limited gold use in consumer electronics.”
Gold used in other industrial and decorative applications fell 6 year-on-year. It was the 10th consecutive quarterly decline.
According to the World Gold Council, China drove the decline due to weaker jewelry plating demand, thinner plating specifications, and the adoption of alternative materials. India reported a smaller drop as demand for gold thread used in traditional clothing dipped.
Gold used in dentistry continued its long-term decline.
Mike Maharrey is a journalist and market analyst for Money Metals with over a decade of experience in precious metals. He holds a BS in accounting from the University of Kentucky and a BA in journalism from the University of South Florida.
