Although the price of gold reached a new record last year, many Swiss investors are parting with their stocks of the yellow precious metal.

The overall demand for gold rose to a new record of 4,899 tons last year, as reported by industry association World Gold Council (WGC) on Wednesday. «The unabated demand of the central banks has supported the development this year,» said WGC Analyst Louise Street.

The price of gold increased sharply in many currencies, and reached a new record of 2,135 dollars per troy ounce at the start of December. The annual performance of the gold price in dollars was 13.1 percent. In euros, this was 9.7 percent.

In Swiss francs, the performance remained low at 2.9 percent. This is because the strong Swiss franc had a corresponding impact. If the central banks lower the interest rates over the further course of 2024, most notably the American Federal Reserve, or Fed, this may spur the gold price on to new heights.

«Fast Money» is the Key Motive

The demand for bars and coins decreased by 3 percent compared to the previous year. While the demand in Europe dropped by 59 percent, demand in China rose by 28 percent. There were also «noteworthy increases» in India, Turkey, and the United States, according to the WGC.

As the old gold study conducted last fall by precious metal trader Philoro and the University of St. Gallen showed, «fast money» is the main reason given by Swiss nationals for selling their gold. The study states that of the 2,633 adults who were surveyed between August and September 2023 in all language regions, a small majority of the population (52 percent) had sold gold jewelry at least once in the past.

Geopolitical Uncertainties

In all, a sustained high demand is expected for 2024 as well. «As well as monetary policy, geopolitical uncertainty is another important driver of the demand for gold. We expect that this will have a significant influence on the market in 2024,» states the WGC.

If you look at which products were particularly popular among coins and bars in Switzerland last year, you can see that the «Gold-Vreneli» 20-franc coin took first place among the gold coins once more. For the gold bars, the 100-gram denomination was especially popular. For silver, the «Philharmonic» 1-ounce coin and 1-kilogram bar were en vogue.