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Visualizing the $2.9B Money Flow into Gold Exploration

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VCE Gold Exploration Projects Around the World-v2

Visualizing the $2.9B Money Flow into Gold Exploration

In 2020, the price of gold reached multi-year highs, in part to the impact of COVID-19 shutdowns. This renewed interest in gold spurred the plans of many gold exploration and development projects around the world.

This infographic uses data from Mining Intelligence which tracked the $2.87 billion from 425 transactions for gold projects in 41 countries between February 1, 2020, and February 28, 2021.

Gold Financings, by Country

Five countries accounted for 75% of the money raised for top gold projects around the world.

Canada attracted the most with $965 million or roughly 34% of all the money raised for gold exploration and development.

CountryAmounts ($USD)Number of Transactions
Canada$965,066,856180
Mexico$389,087,53425
Australia$291,040,97743
United States$255,563,60782
Chile$253,711,4272
Mali$85,728,40213
Guatemala$75,939,9824
Colombia$71,389,2294
Burkina Faso$58,937,8522
Greenland$54,739,5441
Fiji$44,024,2243
Nigeria$40,660,7351
Ivory Coast$37,608,0314
Argentina$30,678,6215
Brazil$30,292,1439
Nicaragua$29,040,3614
Tanzania$22,215,1782
Finland$2,106,07402
Mongolia$15,120,7001
Ghana$14,894,3364
Kyrgyzstan$13,651,8011
Namibia$13,041,6211
Ecuador$8,644,9751
Bulgaria$6,879,4501
Japan$6,569,7422
Guyana$6,282,1342
United Kingdom$4,796,9833
Dem. Republic of the Congo$4,528,4501
Peru$4,436,3356
Sudan$4,066,4841
Cameroon$3,252,9564
Papua New Guinea$1,737,9032
Serbia$1,478,5791
Kenya$1,288,0411
Spain$1,074,2111
Dominican Republic$992,2521
Guinea$387,4831
Kazakhstan$334,7331
Honduras$296,0961
Indonesia$213,8351
South Africa$102,9591
Total$2,870,857,503425

In second place, Mexico attracted $389 million or 14% of total exploration dollars raised while Australia with $291 million (10%) is in third place.

The United States comes in fourth place with $256 million or 9% of global gold exploration dollars. Chile on the fifth spot received $254 million (9%) with one project attracting the largest amount of any on the list.

Top 10 Financings by Gold Project

Focusing on individual projects, Gold Fieldsโ€™ Salares Norte project in Chile received $252 million for the largest financing of the period. The company started construction this year, after a delicateย operation to remove endangered chinchillas from the site.

Silvercrest’s Las Chispas project in Mexico’s Sonora state received $228.9 million, giving it the second largest sum. According to the company, the property hosts 94.7 million ounces of silver equivalent (AgEq) in proven and provable reserves.

PropertiesLocationAmount ($USD)Company
Salares Norte๐Ÿ‡จ๐Ÿ‡ฑ Chile$251,845,426
Gold Fields Ltd.
Las Chispas๐Ÿ‡ฒ๐Ÿ‡ฝ Mexico$228,858,469SilverCrest Metals Inc.
Windfall Lake๐Ÿ‡จ๐Ÿ‡ฆ Canada$130,539,783Osisko Mining Inc.
Blackwater๐Ÿ‡จ๐Ÿ‡ฆ Canada$129,712,140
Artemis Gold Inc.
Magino๐Ÿ‡จ๐Ÿ‡ฆ Canada$108,128,440Argonaut Gold Inc.
Dargues Reef๐Ÿ‡ฆ๐Ÿ‡บ Australia$96,500,680Aurelia Metals Ltd
Cariboo๐Ÿ‡จ๐Ÿ‡ฆ Canada$95,460,630Osisko Development Corp.
Marmato๐Ÿ‡จ๐Ÿ‡ด Colombia$66,116,989Aris Gold Corp.
Cerro Blanco๐Ÿ‡ฌ๐Ÿ‡น Guatemala$65,632,958Bluestone Resources Inc.
Mount Morgans๐Ÿ‡ฆ๐Ÿ‡บ Australia$63,179,600Dacian Gold Ltd.

Gold is Canada’s most valuable mined mineral and the next 3 projects on the list show this priority. Osisko Miningโ€™s Windfall Lake project in Quebec is third ($130 million), Artemis Goldโ€™s Blackwater mine ($130 million) in British Columbia is the fourth, and Argonautโ€™s Magino project in Ontario ($108 million) the fifth.

The analysis found that more than half of the money raised (57%), went to 63 gold projects to advance economic studies โ€“ from scoping studies or preliminary economic assessments through to bankable feasibility studies and permitting.

A total of 71% of the projects were in the early stages of exploration, but they only accounted for about 25% of the total capital raised during the period.

Gold Going Forward

With $2.9 billion in capital going into gold projects around the world, the gold industry has big plans. These financings represent opportunities for host countries’ economies and their workers, along with more gold for investors to buy.

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Mapped: Which Countries Have the Highest Inflation?

Although inflation may have hit its peak, several countries around the world are still facing double-digit inflation in 2022.

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Double-Digit Inflation

Mapped: Which Countries Have the Highest Inflation Rate?

Inflation is surging nearly everywhere in 2022.

Geopolitical tensions are triggering high energy costs, while supply-side disruptions are also distorting consumer prices. The end result is that almost half of countries worldwide are seeing double-digit inflation rates or higher.

With new macroeconomic forces shaping the global economy, the above infographic shows countries with the highest inflation rates, using data from Trading Economics.

Double-Digit Inflation in 2022

As the table below shows, countless countries are navigating record-high levels of inflation. Some are even facing triple-digit inflation rates. Globally, Zimbabwe, Lebanon, and Venezuela have the highest rates in the world.

CountryInflation Rate, Year-Over-YearDate
๐Ÿ‡ฟ๐Ÿ‡ผ Zimbabwe269.0%Oct 2022
๐Ÿ‡ฑ๐Ÿ‡ง Lebanon162.0%Sep 2022
๐Ÿ‡ป๐Ÿ‡ช Venezuela156.0%Oct 2022
๐Ÿ‡ธ๐Ÿ‡พ Syria139.0%Aug 2022
๐Ÿ‡ธ๐Ÿ‡ฉ Sudan103.0%Oct 2022
๐Ÿ‡ฆ๐Ÿ‡ท Argentina88.0%Oct 2022
๐Ÿ‡น๐Ÿ‡ท Turkey85.5%Oct 2022
๐Ÿ‡ฑ๐Ÿ‡ฐ Sri Lanka66.0%Oct 2022
๐Ÿ‡ฎ๐Ÿ‡ท Iran52.2%Aug 2022
๐Ÿ‡ธ๐Ÿ‡ท Suriname41.4%Sep 2022
๐Ÿ‡ฌ๐Ÿ‡ญ Ghana40.4%Oct 2022
๐Ÿ‡จ๐Ÿ‡บ Cuba37.2%Sep 2022
๐Ÿ‡ฑ๐Ÿ‡ฆ Laos36.8%Oct 2022
๐Ÿ‡ฒ๐Ÿ‡ฉ Moldova34.6%Oct 2022
๐Ÿ‡ช๐Ÿ‡น Ethiopia31.7%Oct 2022
๐Ÿ‡ท๐Ÿ‡ผ Rwanda31.0%Oct 2022
๐Ÿ‡ญ๐Ÿ‡น Haiti30.5%Jul 2022
๐Ÿ‡ธ๐Ÿ‡ฑ Sierra Leone29.1%Sep 2022
๐Ÿ‡ต๐Ÿ‡ฐ Pakistan26.6%Oct 2022
๐Ÿ‡บ๐Ÿ‡ฆ Ukraine26.6%Oct 2022
๐Ÿ‡ฒ๐Ÿ‡ผ Malawi25.9%Sep 2022
๐Ÿ‡ฑ๐Ÿ‡น Lithuania23.6%Oct 2022
๐Ÿ‡ช๐Ÿ‡ช Estonia22.5%Oct 2022
๐Ÿ‡ง๐Ÿ‡ฎ Burundi22.1%Oct 2022
๐Ÿ‡ธ๐Ÿ‡น Sao Tome and Principe21.9%Sep 2022
๐Ÿ‡ฑ๐Ÿ‡ป Latvia21.8%Oct 2022
๐Ÿ‡ญ๐Ÿ‡บ Hungary21.1%Oct 2022
๐Ÿ‡ณ๐Ÿ‡ฌ Nigeria21.1%Oct 2022
๐Ÿ‡ฒ๐Ÿ‡ฐ Macedonia19.8%Oct 2022
๐Ÿ‡ฒ๐Ÿ‡ฒ Myanmar19.4%Jun 2022
๐Ÿ‡ฐ๐Ÿ‡ฟ Kazakhstan18.8%Oct 2022
๐Ÿ‡ต๐Ÿ‡ฑ Poland17.9%Oct 2022
๐Ÿ‡ง๐Ÿ‡ฌ Bulgaria17.6%Oct 2022
๐Ÿ‡น๐Ÿ‡ฒ Turkmenistan17.5%Dec 2021
๐Ÿ‡ง๐Ÿ‡ฆ Bosnia and Herzegovina17.3%Sep 2022
๐Ÿ‡ฒ๐Ÿ‡ช Montenegro16.8%Oct 2022
๐Ÿ‡ฆ๐Ÿ‡ด Angola16.7%Oct 2022
๐Ÿ‡ง๐Ÿ‡ซ Burkina Faso16.5%Sep 2022
๐Ÿ‡ช๐Ÿ‡ฌ Egypt16.2%Oct 2022
๐Ÿ‡ฐ๐Ÿ‡ฒ Comoros15.9%Sep 2022
๐Ÿ‡ฐ๐Ÿ‡ฌ Kyrgyzstan15.4%Oct 2022
๐Ÿ‡ท๐Ÿ‡ด Romania15.3%Oct 2022
๐Ÿ‡ง๐Ÿ‡พ Belarus15.2%Oct 2022
๐Ÿ‡จ๐Ÿ‡ฟ Czech Republic15.1%Oct 2022
๐Ÿ‡ท๐Ÿ‡ธ Serbia15.0%Oct 2022
๐Ÿ‡ธ๐Ÿ‡ฐ Slovakia14.9%Oct 2022
๐Ÿ‡ฒ๐Ÿ‡ณ Mongolia14.5%Oct 2022
๐Ÿ‡ณ๐Ÿ‡ฑ Netherlands14.3%Oct 2022
๐Ÿ‡ฆ๐Ÿ‡ฟ Azerbaijan13.7%Oct 2022
๐Ÿ‡ฆ๐Ÿ‡ซ Afghanistan13.6%Sep 2022
๐Ÿ‡ฌ๐Ÿ‡ฒ Gambia13.3%Sep 2022
๐Ÿ‡ญ๐Ÿ‡ท Croatia13.2%Oct 2022
๐Ÿ‡ง๐Ÿ‡ผ Botswana13.1%Oct 2022
๐Ÿ‡ธ๐Ÿ‡ณ Senegal13.0%Oct 2022
๐Ÿ‡จ๐Ÿ‡ฑ Chile12.8%Oct 2022
๐Ÿ‡ฝ๐Ÿ‡ฐ Kosovo12.7%Oct 2022
๐Ÿ‡ท๐Ÿ‡บ Russia12.6%Oct 2022
๐Ÿ‡ฌ๐Ÿ‡ณ Guinea12.4%Jul 2022
๐Ÿ‡ง๐Ÿ‡ช Belgium12.3%Oct 2022
๐Ÿ‡จ๐Ÿ‡ด Colombia12.2%Oct 2022
๐Ÿ‡บ๐Ÿ‡ฟ Uzbekistan12.2%Oct 2022
๐Ÿ‡จ๐Ÿ‡ฌ Congo12.2%Oct 2022
๐Ÿ‡ณ๐Ÿ‡ฎ Nicaragua12.2%Oct 2022
๐Ÿ‡ฐ๐Ÿ‡พ Cayman Islands12.1%Jun 2022
๐Ÿ‡ฒ๐Ÿ‡บ Mauritius11.9%Oct 2022
๐Ÿ‡ฒ๐Ÿ‡ฟ Mozambique11.8%Oct 2022
๐Ÿ‡ฎ๐Ÿ‡น Italy11.8%Oct 2022
๐Ÿ‡ฒ๐Ÿ‡ฑ Mali11.3%Sep 2022
๐Ÿ‡ฒ๐Ÿ‡ท Mauritania11.3%Sep 2022
๐Ÿ‡ฌ๐Ÿ‡ง United Kingdom11.1%Oct 2022
๐Ÿ‡ฆ๐Ÿ‡น Austria11.0%Oct 2022
๐Ÿ‡ธ๐Ÿ‡ช Sweden10.9%Oct 2022
๐Ÿ‡บ๐Ÿ‡ฌ Uganda10.7%Oct 2022
๐Ÿ‡ฌ๐Ÿ‡ช Georgia10.6%Oct 2022
๐Ÿ‡ฉ๐Ÿ‡ช Germany10.4%Oct 2022
๐Ÿ‡ญ๐Ÿ‡ณ Honduras10.2%Oct 2022
๐Ÿ‡ฉ๐Ÿ‡ฐ Denmark10.1%Oct 2022
๐Ÿ‡ต๐Ÿ‡น Portugal10.1%Oct 2022
๐Ÿ‡ฏ๐Ÿ‡ฒ Jamaica9.9%Oct 2022
๐Ÿ‡ธ๐Ÿ‡ฎ Slovenia9.9%Oct 2022
๐Ÿ‡ฌ๐Ÿ‡น Guatemala9.7%Oct 2022
๐Ÿ‡ฟ๐Ÿ‡ฒ Zambia9.7%Oct 2022
๐Ÿ‡ฐ๐Ÿ‡ช Kenya9.6%Oct 2022
๐Ÿ‡ฆ๐Ÿ‡ฒ Armenia9.5%Oct 2022
๐Ÿ‡ฎ๐Ÿ‡ธ Iceland9.4%Oct 2022
๐Ÿ‡ฒ๐Ÿ‡ฌ Madagascar9.3%Aug 2022
๐Ÿ‡ฎ๐Ÿ‡ช Ireland9.2%Oct 2022
๐Ÿ‡ฑ๐Ÿ‡ธ Lesotho9.2%Sep 2022
๐Ÿ‡น๐Ÿ‡ณ Tunisia9.2%Oct 2022
๐Ÿ‡ฌ๐Ÿ‡ท Greece9.1%Oct 2022
๐Ÿ‡บ๐Ÿ‡พ Uruguay9.1%Oct 2022
๐Ÿ‡จ๐Ÿ‡ท Costa Rica9.0%Oct 2022
๐Ÿ‡ง๐Ÿ‡ฉ Bangladesh8.9%Oct 2022
๐Ÿ‡จ๐Ÿ‡พ Cyprus8.8%Oct 2022
๐Ÿ‡ซ๐Ÿ‡ด Faroe Islands8.8%Sep 2022
๐Ÿ‡ฉ๐Ÿ‡ฟ Algeria8.7%Sep 2022
๐Ÿ‡ณ๐Ÿ‡ต Nepal8.6%Sep 2022
๐Ÿ‡ธ๐Ÿ‡ง Solomon Islands8.5%Aug 2022
๐Ÿ‡ฒ๐Ÿ‡ฝ Mexico8.4%Oct 2022
๐Ÿ‡ฌ๐Ÿ‡ผ Guinea Bissau8.4%Sep 2022
๐Ÿ‡ฆ๐Ÿ‡ฑ Albania8.3%Oct 2022
๐Ÿ‡ง๐Ÿ‡ง Barbados8.3%Aug 2022
๐Ÿ‡ซ๐Ÿ‡ฎ Finland8.3%Oct 2022
๐Ÿ‡ฒ๐Ÿ‡ฆ Morocco8.3%Sep 2022
๐Ÿ‡ต๐Ÿ‡ช Peru8.3%Oct 2022
๐Ÿ‡ฉ๐Ÿ‡ด Dominican Republic8.2%Oct 2022
๐Ÿ‡จ๐Ÿ‡ป Cape Verde8.2%Oct 2022
๐Ÿ‡ต๐Ÿ‡พ Paraguay8.1%Oct 2022
๐Ÿ‡น๐Ÿ‡ฑ East Timor7.9%Sep 2022
๐Ÿ‡น๐Ÿ‡ฌ Togo7.9%Sep 2022
๐Ÿ‡ต๐Ÿ‡ญ Philippines7.7%Oct 2022
๐Ÿ‡บ๐Ÿ‡ธ U.S.7.7%Oct 2022
๐Ÿ‡จ๐Ÿ‡ฒ Cameroon7.6%Sep 2022
๐Ÿ‡ณ๐Ÿ‡ด Norway7.5%Oct 2022
๐Ÿ‡ธ๐Ÿ‡ฌ Singapore7.5%Sep 2022
๐Ÿ‡ฟ๐Ÿ‡ฆ South Africa7.5%Sep 2022
๐Ÿ‡ธ๐Ÿ‡ป El Salvador7.5%Oct 2022
๐Ÿ‡ฒ๐Ÿ‡น Malta7.4%Oct 2022
๐Ÿ‡ฆ๐Ÿ‡บ Australia7.3%Sep 2022
๐Ÿ‡ช๐Ÿ‡ธ Spain7.3%Oct 2022
๐Ÿ‡น๐Ÿ‡ฉ Chad7.2%Sep 2022
๐Ÿ‡ณ๐Ÿ‡ฟ New Zealand7.2%Sep 2022
๐Ÿ‡ง๐Ÿ‡ฟ Belize7.1%Sep 2022
๐Ÿ‡ณ๐Ÿ‡ฆ Namibia7.1%Oct 2022
๐Ÿ‡ฆ๐Ÿ‡ผ Aruba7.0%Sep 2022
๐Ÿ‡จ๐Ÿ‡ฆ Canada6.9%Oct 2022
๐Ÿ‡ฑ๐Ÿ‡บ Luxembourg6.9%Oct 2022
๐Ÿ‡ธ๐Ÿ‡ด Somalia6.9%Oct 2022
๐Ÿ‡ฎ๐Ÿ‡ณ India6.8%Oct 2022
๐Ÿ‡ฆ๐Ÿ‡ช United Arab Emirates6.8%Jun 2022
๐Ÿ‡ฌ๐Ÿ‡พ Guyana6.5%Sep 2022
๐Ÿ‡ฑ๐Ÿ‡ท Liberia6.5%Jul 2022
๐Ÿ‡ง๐Ÿ‡ท Brazil6.5%Oct 2022
๐Ÿ‡ง๐Ÿ‡ธ Bahamas6.3%Aug 2022
๐Ÿ‡จ๐Ÿ‡ฎ Ivory Coast6.3%Sep 2022
๐Ÿ‡น๐Ÿ‡น Trinidad and Tobago6.3%Aug 2022
๐Ÿ‡ซ๐Ÿ‡ท France6.2%Oct 2022
๐Ÿ‡ฉ๐Ÿ‡ฏ Djibouti6.1%Sep 2022
๐Ÿ‡ต๐Ÿ‡ท Puerto Rico6.1%Sep 2022
๐Ÿ‡ง๐Ÿ‡น Bhutan6.1%Sep 2022
๐Ÿ‡ง๐Ÿ‡น Qatar6.0%Sep 2022
๐Ÿ‡น๐Ÿ‡ญ Thailand6.0%Oct 2022
๐Ÿ‡ธ๐Ÿ‡ฟ Swaziland5.8%Aug 2022
๐Ÿ‡ฎ๐Ÿ‡ฉ Indonesia5.7%Oct 2022
๐Ÿ‡ฐ๐Ÿ‡ท South Korea5.7%Oct 2022
๐Ÿ‡น๐Ÿ‡ฏ Tajikistan5.7%Sep 2022
๐Ÿ‡ต๐Ÿ‡ฌ Papua New Guinea5.5%Jun 2022
๐Ÿ‡ฐ๐Ÿ‡ญ Cambodia5.4%Jul 2022
๐Ÿ‡ฎ๐Ÿ‡ถ Iraq5.3%Sep 2022
๐Ÿ‡ฏ๐Ÿ‡ด Jordan5.2%Oct 2022
๐Ÿ‡ซ๐Ÿ‡ฏ Fiji5.1%Sep 2022
๐Ÿ‡ฎ๐Ÿ‡ฑ Israel5.1%Oct 2022
๐Ÿ‡ณ๐Ÿ‡จ New Caledonia5.0%Sep 2022
๐Ÿ‡น๐Ÿ‡ฟ Tanzania4.9%Oct 2022
๐Ÿ‡ง๐Ÿ‡ฒ Bermuda4.5%Jul 2022
๐Ÿ‡ช๐Ÿ‡ท Eritrea4.5%Dec 2021
๐Ÿ‡ฒ๐Ÿ‡พ Malaysia4.5%Sep 2022
๐Ÿ‡ญ๐Ÿ‡ฐ Hong Kong4.4%Sep 2022
๐Ÿ‡ต๐Ÿ‡ธ Palestine4.4%Oct 2022
๐Ÿ‡ง๐Ÿ‡ณ Brunei4.3%Sep 2022
๐Ÿ‡ฑ๐Ÿ‡พ Libya4.3%Sep 2022
๐Ÿ‡ป๐Ÿ‡ณ Vietnam4.3%Oct 2022
๐Ÿ‡ช๐Ÿ‡จ Ecuador4.0%Oct 2022
๐Ÿ‡ง๐Ÿ‡ญ Bahrain4.0%Sep 2022
๐Ÿ‡ฏ๐Ÿ‡ต Japan3.7%Oct 2022
๐Ÿ‡ฐ๐Ÿ‡ผ Kuwait3.2%Sep 2022
๐Ÿ‡ณ๐Ÿ‡ช Niger3.2%Sep 2022
๐Ÿ‡ฒ๐Ÿ‡ป Maldives3.1%Sep 2022
๐Ÿ‡ฌ๐Ÿ‡ฆ Gabon3.0%Jul 2022
๐Ÿ‡ฑ๐Ÿ‡ฎ Liechtenstein3.0%Oct 2022
๐Ÿ‡ธ๐Ÿ‡ฆ Saudi Arabia3.0%Oct 2022
๐Ÿ‡จ๐Ÿ‡ญ Switzerland3.0%Oct 2022
๐Ÿ‡ธ๐Ÿ‡จ Seychelles2.9%Oct 2022
๐Ÿ‡ฌ๐Ÿ‡ถ Equatorial Guinea2.9%Dec 2021
๐Ÿ‡ง๐Ÿ‡ด Bolivia2.9%Oct 2022
๐Ÿ‡น๐Ÿ‡ผ Taiwan2.7%Oct 2022
๐Ÿ‡จ๐Ÿ‡ซ Central African Republic2.7%Dec 2021
๐Ÿ‡ป๐Ÿ‡บ Vanuatu2.7%Mar 2022
๐Ÿ‡ด๐Ÿ‡ฒ Oman2.4%Sep 2022
๐Ÿ‡ง๐Ÿ‡ฏ Benin2.1%Oct 2022
๐Ÿ‡จ๐Ÿ‡ณ China2.1%Oct 2022
๐Ÿ‡ต๐Ÿ‡ฆ Panama1.9%Sep 2022
๐Ÿ‡ฒ๐Ÿ‡ด Macau1.1%Sep 2022
๐Ÿ‡ธ๐Ÿ‡ธ South Sudan-2.5%Aug 2022

*Inflation rates based on the latest available data.

As price pressures mount, 33 central banks tracked by the Bank of International Settlements (out of a total of 38) have raised interest rates this year. These coordinated rate hikes are the largest in two decades, representing an end to an era of rock-bottom interest rates.

Going into 2023, central banks could continue this shift towards hawkish policies as inflation remains aggressively high.

The Role of Energy Prices

Driven by the war in Ukraine, energy inflation is pushing up the cost of living around the world.

Since October 2020, an index of global energy pricesโ€”made up of crude oil, natural gas, coal, and propaneโ€”has increased drastically.

Double-Digit Inflation

Compared to the 2021 average, natural gas prices in Europe are up sixfold. Real European household electricity prices are up 78% and gas prices have climbed even more, at 144% compared to 20-year averages.

Amid global competition for liquefied natural gas supplies, price pressures are likely to stay high, even though they have fallen recently. Other harmful consequences of the energy shock include price volatility, economic strain, and energy shortages.

โ€œThe world is in the midst of the first truly global energy crisis, with impacts that will be felt for years to comeโ€.

-Fatih Birol, executive director of the IEA

Double-Digit Inflation: Will it Last?

If history is an example, taming rising prices could take at least a few years yet.

Take the sky-high inflation of the 1980s. Italy, which managed to combat inflation faster than most countries, brought down inflation from 22% in 1980 to 4% in 1986.

If global inflation rates, which hover around 9.8% in 2022, were to follow this course, it would take at least until 2025 for levels to reach the 2% target.

Itโ€™s worth noting that inflation was also highly volatile over this decade. Consider how inflation fell across much of the rich world by 1981 but shot up again in 1987 amid higher energy prices. Federal Reserve chair Jerome Powell spoke to the volatility of inflation at their November meeting, indicating that high inflation has a chance of following a period of low inflation.

While the Federal Reserve projects U.S. inflation to fall closer to its 2% target by 2024, the road ahead could still get a lot bumpier between now and then.

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Real Assets

Explained: India’s Gold Demand During Diwali

Why do Indians buy gold during Diwali?

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india's gold demand during diwali

Indiaโ€™s Gold Demand During Diwali

In India, goldโ€™s significance goes far beyond investment and jewelry. The yellow metal is woven into Indiaโ€™s cultural history and is revered by a population of over 1.3 billion.

India is one of the largest markets for gold consumption, with jewelry, bars, and coins accounting for the bulk of annual demand. Indian gold demand typically peaks between October and December on the back of Diwali, the festival of lights, followed by thousands of weddings.

But why do Indians buy gold during Diwali?

Goldโ€™s Significance During Diwali

Indians consider it auspicious to purchase goldโ€”a symbol of wealth, purity, and prosperityโ€”on many festive occasions, and Diwali is the biggest one of them.

Diwali is a five-day festival that celebrates the triumph of good over evil and light over darkness, based on Hindu mythology. For many Indians, this festival is associated with welcoming good luck, positivity, and prosperity.

People often dedicate gold purchases during Diwali to deities, especially Lakshmi, the goddess of wealth. Gold is also a popular festive and wedding gift at this time of the year.

Indiaโ€™s Record Gold Demand in Diwali 2021

Indiaโ€™s gold consumption in the second half of every year is typically higher than in the first half, coinciding with Diwali in October (beginning of Q4), according to data from the World Gold Council.

YearGold Jewelry, Bar, and Coin Demand
(tonnes)
YoY % Change
H1 2010447N/A
H2 2010555N/A
H1 201159032.1%
H2 2011384-30.8%
H1 2012404-31.5%
H2 201251032.7%
H1 201355737.9%
H2 2013402-21.3%
H1 2014370-33.5%
H2 201446315.3%
H1 2015350-5.5%
H2 20155079.5%
H1 2016229-34.5%
H2 2016437-13.9%
H1 201736358.4%
H2 2017408-6.6%
H1 2018341-6.2%
H2 20184202.9%
H1 20193729.2%
H2 2019318-24.2%
H1 2020166-55.5%
H2 2020281-11.8%
H1 202128572.3%
H2 202151282.3%
H1 20223067.3%

Following a significant drop in demand in 2020, Indians bought a record amount of gold jewelry in Q4 2021 at 265 tonnes, worth $15.3 billion at the time. Overall, gold jewelry, bar, and coin demand in H2 2021 saw an 82% increase year-over-year.

This increase was largely driven by the festive season and pent-up demand from subdued celebrations and consumption in 2020. As of the first half of 2022, gold demand was up 7.3% relative to 2021.

With Diwali celebrations in full swing, will India see another record quarter for gold demand? It remains to be seen, with goldโ€™s festive tailwinds likely to meet economic headwinds in the form of uncertainty and higher import duties.

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