JOHANNESBURG (miningweekly.com) – After plunging to a six-year low in the second quarter, global gold demand climbed 8% in the third quarter as a dip in the gold price triggered a “truly global” consumer response.

The World Gold Council’s (WGC’s) third-quarter Gold Demand Trends report, released on Thursday, showed gold demand recovering from the 12% drop to 915 t recorded in the preceding quarter, to 1 120.9 t, as the sharp price drop resulted in a buying appetite for gold jewellery, bars and coins.

While China and India remained the dominant figures in the global gold market, accounting for close to 45% of total demand, demand for bars and coins surged in the US and Europe as investors sought to “grab a bargain,” WGC market intelligence head Alistair Hewitt said this week.

This started the third quarter with a “jolt” as investors embarked on a six-week buying spree, with total consumer demand for jewellery, coins and bars increasing 14% to 928 t.

Overall jewellery demand for the third quarter was up 6%, despite the quarter traditionally being a slow season for sales, to 632 t, with consumers in India, China, the US and the Middle East taking advantage of lower prices in July and August.

In India, demand was up 15% to 211 t; in China, demand was up 4% to 188 t; and in the US and the Middle East demand increased 2% to 26 t and 8% to 56 t respectively.

Bar and coin demand surged to a two-year high at 295.7 t – 33% higher than the corresponding quarter the year before and 46% higher than the second quarter.

Coin sales by the US Mint during the quarter were on a par with that of the fourth quarter of 2008, when demand surged during the global financial meltdown.

“European investors were also enthusiastic buyers; demand was up by more than a third to 60.9 t,” the report added.

However, the sudden rush for bars, coins and jewellery subsided mid-August as the gold price edged up.

The report showed that central banks, net buyers for the nineteenth consecutive quarter, remained a significant source of demand during the third quarter with purchases by official sector institutions reaching 175 t – nearly reaching the record highs of the third quarter of 2014.

Meanwhile, recycling demand fell to its lowest level since 2008, dwindling from 268 t to 252.3 t, 6% lower than the third quarter of last year.

“The fall in price witnessed in July meant most price-sensitive consumers were inclined to hold onto their gold rather than sell,” the report pointed out.

Meanwhile, gold supply inched up 1% year-on-year to 1 100 t, while total mine supply – mine production and net producer hedging – increased 3% year-on-year to 848 t during the quarter under review.

Year-on-year, mine production contracted 1% to 828 t in the third quarter.