Global gold demand soared in the fourth quarter of 2021 as inflation rocketed, helping to recoup much of the drop triggered by the pandemic, new industry data showed.
Viewed as a haven investment in times of economic unrest, gold saw demand surge 50% in the final three months of last year compared with the October-December period in 2020, the World Gold Council said in a report.
Overall last year, "demand recouped much of the Covid-related losses sustained during 2020", the WGC said, adding that total physical purchases jumped 10% to 4,021 tonnes.
Gold demand "in the consumer-driven jewellery and technology sectors recovered throughout the year in line with economic growth and sentiment, while central bank buying also far outpaced that of 2020", the Council added.
Looking ahead, it said expansion of 5G telecoms infrastructure should help support demand for gold in the sector.
"But demand faces some risks from a slowdown in China as well as Covid-related restrictions," the WGC warned.
Gold jewellery demand jumped by more than half in 2021 on strong buying in India and China, as celebrations including marriages postponed by Covid finally took place.
In India, "millions of people get married, and that involves a certain amount of gold", WGC spokesman John Mulligan told AFP.
Elsewhere, global bar and coin investment reached an eight-year high.
"Inflation concerns were a key driver, especially in the US and Germany, which both saw record annual demand," the report said.
However global holdings of gold exchange-traded funds - that allow investment outside of futures market - fell by $9 billion, or five percent, last year.
Overall, "gold drew direction chiefly from inflation and interest rate expectations in 2021", the WGC concluded.
Central banks are raising interest rates to combat decades-high inflation.
"Investment may struggle in 2022 amid competing forces but consumer demand should hold strong and central banks will likely keep buying."
The gold price dropped 4% last year.