In the third quarter, global interest in gold surpassed $100 billion, a historic record, as a result of investor FOMO, which has fueled a surge in its demand.
This increase is indicative of a change in perception, as investors regard both gold and Bitcoin as secure havens in the face of economic uncertainty. The price of gold increased by 34% this year, reaching $2,788 per troy ounce, and the demand for gold increased by 5% to 1,313 tones.
After nine quarters of outflows, the World Gold Council reported a rebound in gold-backed ETFs, with inflows totaling 94 tones. This quarter, the total investment demand for physical gold increased by twofold to 364 million tones, with affluent families and institutional investors being the primary drivers.
In contrast, the central bank’s gold purchases decreased by 49% year-over-year to 186 tones, the lowest level in two years, primarily as a result of the high prices. In the interim, the demand for jewelry, which accounts for 40% of global gold consumption, experienced a 7% decline in Q3.
Retail interest in Bitcoin remains minimal, with Google Trends indicating a mere 23 out of 100 in search interest as it approaches its all-time high. Despite a recent increase in the Coinbase app’s ranking, retail activity has not yet reached the levels of previous rallies. Nevertheless, Bitcoin is gathering momentum in Europe, surpassing its March ceiling against the euro and capitalizing on the frailty of a variety of fiat currencies. This demonstrates its potential as a hedge against the depreciation of traditional currencies.
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