Here are 10 facts:
1. Overall gold consumption fell 7 per cent, or nearly 76 tonnes, to 990 tonnes in the three months to June, its lowest quarterly level since the first three months of 2010, the WGC said in its quarterly Gold Demand Trends report.
2. Investment and jewellery demand from consumers in India, the world's No. 1 gold market, plummeted 38 per cent to 181.3 tonnes in the second quarter. Buying has been hit by a hike in import duties and record-high local prices due to a weak rupee.
3. The WGC expects demand from India to fall to 650-750 tonnes this year from 933 tonnes in 2011, and Chinese demand to rise 10 per cent to 850 tonnes.
4. WGC's managing director for investment research, Marcus Grubb, said he still expected demand growth in the full year but that forecast was heavily dependent on gold-friendly policy moves from central banks and a recovery in Indian demand.
5. "The real wild card is India. It depends how weak the latter part of the year is and/or how much of an improvement we see," Grubb said. "It also depends on what happens from a macro perspective between now and the end of the year to catalyse more buying.
6. Demand from China has fallen 7 per cent to 144.9 tonnes. A slowdown in economic growth and a lack of clear price direction in gold was behind the drop, the WGC said.
7. Jewellery and investment purchases in the US fell 17 per cent to 34.2 tonnes, the same off-take that was seen in Germany after a 51 per cent jump in coin and bar investment. European Union demand was a rare bright spot, rising 11 per cent to 86.4 tonnes.
8. European buying has increased as consumers have sought refuge from the euro zone debt crisis and its impact on the single currency, which is down 5 per cent against the dollar this year.
9. Official sector purchases of gold more than doubled, meanwhile, to a record 157.5 tonnes in the last quarter, with Russia, Kazakhstan, Turkey and Ukraine all announcing a rise in bullion reserves in that period.
10. "If you look to the half-year, central banks have bought 254 tonnes against 200 tonnes for the half-year last year," Grubb said. "At this rate, we'll be looking at a record central bank year, higher than last year, which was a record since 1964."
Copyright: Thomson Reuters 2012