Gold investment up 78% in Q2 2025; Saudi enjoys broad customer base: WGC

Andrew Naylor, Head of Middle East and Public Policy at the World Gold Council (WGC)

Gold investment soared 78% year-on-year (YoY) in Q2 2025, nearing record levels, Andrew Naylor, Head of Middle East and Public Policy at the World Gold Council (WGC), told Argaam in an interview.

Naylor attributed this surge to institutional flows, particularly gold-backed exchange-traded funds (ETFs), the Federal Reserve’s rate cuts starting late last year, and heightened geopolitical tensions.

Central banks remain key drivers of bullion performance, having maintained net purchases since 2010. Over the past three years, they have added over 1,000 tonnes annually to diversify reserves and reduce dependence on the US dollar.

Last quarter, central bank demand increased but at a slower pace. However, a June WGC survey showed that 85% of central banks plan to boost gold reserves over the next 12 months, according to Naylor.

In Saudi Arabia, jewelry demand dropped 15% YoY in H1 2025, with retail investment also down as individuals sold gold for recycling to benefit from high prices.

Naylor noted that Saudi demand spans beyond the wealthy, making the market more price sensitive. Gold coin demand saw a notable drop due to this volatility.

While the WGC does not issue price targets, he expects gold to stay high and resilient in H2 2025, supported by geopolitical risks, slower rate cuts, and rising global debt concerns, particularly in the West and Japan.