Kuwait’s gold demand experienced a significant decline in the first quarter of 2025, falling by 15% to 3.8 tons, compared to 4.5 tons in the same period last year, according to the World Gold Council’s latest report. This drop reflects a cautious market response to rising global economic uncertainty and a steep increase in gold prices.
Decline in Jewelry and Investment Demand
Demand for gold bars and coins decreased by 5% year-on-year in Q1 2025, reaching 1.4 tons, down from 1.5 tons in Q1 2024. Jewelry consumption saw a sharper decline, falling 20% to 2.4 tons from 3.1 tons in the same period.
This downturn follows a broader downward trend observed in 2024, when total gold and jewelry consumption in Kuwait fell by 6%, from 19.6 tons in 2023 to 18.4 tons. Jewelry demand dropped 14% to 12.3 tons, while investment in gold bars and coins rose by 16% to 6.1 tons, indicating a shift toward investment-grade bullion. In 2024, Kuwait’s per capita gold consumption was approximately 3.66 grams.
Kuwait’s Position in the Gold Market
Over the past five years, Kuwait has consumed 86.4 tons of gold, ranking as the fourth-largest gold market in the Arab world, behind Saudi Arabia, the UAE, and Egypt, and 21st globally. This total includes 64.5 tons of jewelry and 21.9 tons of bars and coins. Jewelry demand peaked at 14.7 tons in 2022 but retreated to 12.3 tons in 2024, while demand for gold bars and coins grew from 2.7 tons in 2020 to 6.1 tons in 2024, reflecting increasing interest in gold as a hedge against economic instability.
Price Surge Impacting Consumer Behavior
The recent drop in gold demand is largely attributed to a sharp 25% rise in gold prices during the first quarter of 2025. Concerns over a potential global recession and ongoing economic volatility have deterred many Kuwaitis and expatriates from making gold purchases.
Local gold prices have seen substantial increases, with 24-karat gold climbing by KWD 6.5 per gram since December. Prices for 22-karat and 21-karat gold also rose by KWD 5.9 and KWD 5.7, respectively, while 18-karat gold increased by KWD 4.88. The price of gold per ounce (31.3 grams) reached KWD 202.249. However, by the last week of April, gold prices saw a slight correction, dipping around 2% from the highs recorded earlier in the month.
