Gold is likely to be on course for its best week after mid-March, thanks to US banking woes and hopes that the Federal Reserve will pause rate hikes in July.

Lower rates always supports gold, which doesn’t offer any interest.

Spot gold slipped 0.6% to $2,038.84 per ounce by Friday 0924 GMT but was up 2.5% for the week.

Meanwhile, the World Gold Council reported a mixed picture for gold demand in Q1, 2023.

Louise Street, Senior Markets Analyst at the World Gold Council (WGC), explained the key highlights from new research: 

  1. Q1 2023 saw very high gold prices, with record highs in some local currencies.
  2. Central banks remained a key pillar of gold demand in Q1. They bought around 330 tonnes, which amount to the strongest start to a year of buying by official sector institutions that the WGC has seen in its data series.
  3. China saw very strong jewellery demand, driven by consumers going on a relief-driven shopping spree as they had their first full quarter without COVID-19 related lockdown curbs.
  4. On the other hand, India saw a sharp drop in jewellery demand as consumers responded to gold prices in rupee terms which reached a record high.
  5. On the investment side, bar and coin demand remained very strong exceeding 300 tonnes for a third consecutive quarter.
  6. ETFs saw modest outflows during Q1. Investment sentiments in that space improved throughout Q1 and continued into Q2.

(Writing by Seban Scaria; editing by Daniel Luiz)