Strong prices and risk lift Thai gold demand

Q1 notches 7-year high for investment

PUBLISHED : 6 May 2026 at 07:04

WRITER: Nareerat Wiriyapong

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Thailand's investment in gold bars and coins hit a seven-year high in the first quarter, rising 35% year-on-year to 10 tonnes as growing economic and political uncertainty underpinned the metal's safe-haven appeal in the country, says the World Gold Council (WGC).

According to Shaokai Fan, head of Asia-Pacific (excluding China) and global head of central banks at WGC, the trend is expected to continue throughout the year as investors respond to gold's exceptional performance amid a backdrop of rising geopolitical and economic uncertainty.

"The ongoing geopolitical risk, with further impetus from elevated inflation and persistent high gold prices, is expected to support investment and central bank demand," he said.

Louise Street, senior markets analyst at WGC, said gold's volatility has increased substantially this year, with prices peaking above US$5,400 an ounce in January before undergoing "a significant but contained correction".

The combination of price momentum and heightened geopolitical risk propelled investment demand, most notably in Asia, as investors sought security in physical gold, alongside continued central bank buying, she said.

"The geopolitical risk premium should continue to support investment demand, though interest rates remaining elevated may present headwinds, especially in Western markets," Ms Street said.

Jewellery spending is expected to remain resilient, even as high prices weigh on volumes. On the supply side, mine production is likely to grow modestly, although potential energy shortages could temper the outlook, she said.

Total global quarterly gold demand edged up 2% year-on-year to 1,231 tonnes, but soared 74% in value to a record $193 billion. Retail investors were also drawn to gold's price momentum and safe-haven appeal, driving bar and coin expenditure up 42% year-on-year to 474 tonnes.

Other Asian markets, including China, India, South Korea and Japan, recorded increased bar and coin purchases, while the US and European markets recorded demand upticks of 14% and 50%, respectively.

Demand for gold exchange-traded funds remained positive in the first quarter, with holdings increasing by 62 tonnes, largely supported by continued strength across Asian-listed funds, which added 84 tonnes over the quarter. The figure was offset by sizeable outflows in March, mostly from US-listed funds.

In contrast, jewellery demand declined sharply, falling 23% year-on-year to 300 tonnes in response to the higher prices throughout the quarter, with Thailand's jewellery demand dipping 5% year-on-year to 1.7 tonnes.

Demand weakened across all major markets, with notable declines in China (-32%), India (-19%) and the Middle East (-23%).

However, in value terms jewellery demand increased, indicating continued consumer willingness to spend on gold despite record prices.

Market analysis suggests some jewellery consumption has moved into bar and coin demand, particularly in markets like China and India where jewellery can act as a proxy investment, said Mr Fan.

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- KEYWORDS

- Thai gold demand

- Gold market analysis

- World gold council

- Investment gold

- Geopolitical risk

- Gold price trends

- Central bank gold buying