Gold loses its shine as the demand for jewellery falls

GOLD demand fell to its lowest in six years in the second quarter, the World Gold Council said yesterday, as the global downturn hit jewellery consumption and electronics producers&rsquo; buying demand.<br /><br />Demand worldwide fell nine per cent in the period to 720 tonnes, the lowest since the first quarter of 2003.<br /><br />Consumption of jewellery dropped 22 per cent, while electronics, which has the biggest industrial use for the precious metal, saw demand fall 26 per cent.<br /><br />But investor demand soared 46 per cent to 222 tonnes as they sought out safe havens for their cash in the slump.<br /><br />&ldquo;Investment demand witnessed a strong quarter and we believe this indicates a growing recognition of gold as an important and independent asset class,&rdquo; the council&rsquo;s chief executive Aram Shishmanian said.