Global gold demand reached a record US$193 billion in the first quarter of 2026, driven by an unprecedented buying spree in China and surging safe-haven investment across Asia — even as Turkey quietly offloaded roughly 10% of its national gold reserves.
The World Gold Council’s quarterly demand report shows total demand including over-the-counter transactions rose 2% year-on-year to 1,231 tonnes in Q1. Combined with gold’s exceptional price performance, that modest volume growth produced a 74% jump in value. The LBMA gold price averaged US$4,873 per ounce for the quarter — itself a record — after hitting an all-time high of US$5,405 per ounce in January.
China shatters its own record
Chinese investors snapped up 207 tonnes of gold bars and coins — a record that demolished the previous high of 155 tonnes set in Q2 2013. Some popular smaller investment items sold out in January and February.
Falling equity markets, a weakening yuan, heightened trade risks, and a lack of compelling domestic alternatives all drove the buying. China’s Q4 2025 VAT reform on gold jewellery further accelerated the shift, making investment-grade bars and coins comparatively more attractive. Bar and coin demand in China now exceeds jewellery consumption. The WGC sees Chinese insurance companies potentially building gold allocations as additional upside.
Bar and coin investment surged across Asia. Indonesia’s demand more than doubled quarter-on-quarter to 23.6 tonnes, a 47% year-on-year gain. South Korea posted a record quarter. India’s bar and coin purchases hit their highest first quarter since 2013, nearly matching jewellery demand — a historic inflection in a market where jewellery consumption has traditionally been multiples of investment buying.
Global bar and coin demand reached 474 tonnes, the second highest quarter on record, valued at US$74 billion — more than three times the prior five-year quarterly average.
Turkey’s reserves drained
Official sector gold holdings in Turkey fell around 70 tonnes in Q1 — roughly 10% of total official holdings — with the bulk of sales coming in March. The central bank utilized an additional 80 tonnes via gold swaps for foreign exchange and liquidity purposes the same month. Governor Fatih Karahan told reporters most swap transactions took the form of gold-currency swap futures, meaning the gold would return to reserves upon maturity, according to Bloomberg HT. Holdings stabilized around 535 tonnes in April. Turkey deployed reserves similarly during periods of financial stress in 2020 and 2023.
Azerbaijan’s State Oil Fund sold 22 tonnes in Q1, partially reversing 2025 purchases. Russia’s central bank reported a matching 22-tonne sale. Central banks and sovereign wealth funds reported 115 tonnes in total gold sales during the quarter — a notable increase against recent history, offset by continued strong buying elsewhere.
Net central bank demand remained positive at 244 tonnes, up 3% year-on-year. Poland (31 tonnes) and Uzbekistan (25 tonnes) led purchases. The People’s Bank of China added 7 tonnes, more than doubling its Q4 2025 net purchase.
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Geopolitics at the center
The WGC pins the quarter’s dynamics on the conflict involving the US, Israel, and Iran, along with uncertainty over the incoming Federal Reserve chair and strained US-China relations. Government bond yields remain elevated as central banks navigate supply shocks from the Middle East war, and a positive stock-bond correlation has undermined bonds’ appeal as a hedge.
Investment and central bank demand are expected to stay supported through 2026, with bar and coin buying likely to feature more prominently than ETFs as inflation fears and geopolitical uncertainty keep drawing savers and speculators toward gold.
Global gold ETF demand added 62 tonnes in Q1 — a seventh consecutive positive quarter, though well below the 200-tonne average of the prior four quarters. Asian funds generated consistent monthly gains, while North American funds posted net outflows for the first time in nine months after a sharp March reversal.
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