Gold Market Update: Q2 2025 Sees Supply Rise Amidst Demand Dip
London, UK – July 29, 2025 – The global gold market experienced a dynamic second quarter, with supply increasing while demand softened, according to recent data released by the World Gold Council. Total global gold supply reached 1249 tons, marking a 6% increase quarter-over-quarter and a 3% rise year-over-year. This growth was primarily fueled by a surge in mining production, which climbed to 908.6 tons – a 9% increase compared to the previous quarter and a 1% increase annually.key mining regions contributing to this increase include Australia, Canada, and Ghana.
Supply Breakdown
The increase in mining production reflects ongoing investments in exploration and operational improvements by major gold producers like Newmont Corporation and Barrick Gold. Recycling also contributed to the overall supply, though to a lesser extent. The World Gold Council noted that increased geopolitical tensions and economic uncertainty initially supported gold prices,but this effect was offset by the demand slowdown.
Demand Slowdown
despite an annual increase of 10%, global gold demand decreased to 1079 tons in the quarter ending June, representing a 17% decline quarter-over-quarter. This decrease was primarily driven by reduced demand in two key sectors: jewelry and industrial applications.Demand for gold jewelry experienced a significant downturn in India and china, traditionally the largest gold-consuming nations, due to factors including fluctuating currency exchange rates and seasonal buying patterns.Industrial demand also saw a decline, impacted by a slowdown in the electronics sector. Notably, central bank purchases, which have been a significant driver of gold demand in recent years, slowed considerably during the quarter. The People’s Bank of China, a major gold buyer, reduced its acquisitions, contributing to the overall decrease.
Looking Ahead
Analysts predict that the gold market will remain sensitive to macroeconomic factors, including inflation, interest rate policies of the US Federal Reserve and the European Central Bank, and geopolitical developments. The World Gold Council anticipates continued volatility in the short term, with potential for demand to recover in the second half of 2025 if economic conditions improve and central bank buying resumes. The price of gold currently hovers around $2300 per ounce as of july 29, 2025.
Source: World Gold Council
