Gold in the Private Sector

The private ownership of gold varies dramatically across different countries, influenced by cultural traditions, economic factors, and investment philosophies. This analysis explores how citizens in the world's largest gold markets approach gold ownership.

From India's enormous household holdings exceeding official reserves of major nations to Germany's investment-focused approach and Turkey's integration of private gold into the banking system, these distinct patterns shape both national economies and the global gold market.

Gold demand reached unprecedented levels in 2024, with total global demand increasing by 1% year-on-year to 4,974 tonnes, establishing new records as prices climbed to historic highs. This surge was primarily driven by investment demand and central bank purchases, despite a notable decline in jewelry consumption.

Investment in gold witnessed its strongest performance in four years, growing by 25% to 1,180 tonnes globally. This remarkable growth occurred alongside stable demand for physical gold in the form of bars and coins, which maintained a consistent level of 1,186 tonnes.

Note: The 2025 data shown represents forecasted values based on current market trends and expert analysis.

Meanwhile, jewelry demand experienced an 11% decline, falling to 1,877 tonnes due to escalating gold prices that limited purchasing power in many markets. Paradoxically, spending on gold jewelry increased by 9% to $144 billion, highlighting consumers' willingness to pay premium prices despite purchasing smaller quantities.

Indian households have amassed approximately 25,000 tonnes of gold as of 2025, a figure that exceeds the combined official reserves of major gold-holding nations such as the United States, Germany, Italy, France, and Russia. This vast private hoard reflects deep-rooted cultural practices, including the preference for gold dowries and temple offerings.

"Gold in India is not just an investment—it's a multi-dimensional asset that serves as financial security, cultural symbol, and social status marker."

Tamil Nadu accounts for 28% of the country's gold holdings, with northern and western states showing lower per capita ownership. Demand spikes during festivals like Diwali and Dhanteras, highlighting the seasonal nature of India's gold consumption patterns.

Gold serves not only as a cultural artifact but also as a strategic financial buffer for Indian households, especially in rural areas where gold is used as collateral for loans and a hedge against inflation. It is estimated that household gold theoretically covers 40% of India's GDP, highlighting its economic significance beyond cultural value.

Germany stands out as a nation with exceptional private gold holdings, reflecting the German population's strong orientation toward security in their investment choices. German citizens possess substantially more gold per capita for investment purposes than their counterparts in France and Italy, demonstrating a distinctive preference for physical gold assets.

According to the latest 'Reisebank Gold Study 2025', German private households own more than 9,089 tonnes of gold worth approximately €616 billion. This represents an increase of 270 tonnes compared to the previous study in 2019. Of this total, 41.7% (approximately 3,790 tonnes) is held in the form of gold bars and coins, while the remainder is in jewelry and watches.

The study reveals that 93.2% of German gold investors are satisfied with their gold investments, up from 91% in the previous survey. More than three-quarters of respondents plan to purchase more gold in the future, indicating continued strong interest in gold as a safe-haven asset.

Another significant trend is the increasing interest among younger investors, with the percentage of "Generation Z" investors (born between 1995 and 2010) rising from 15.6% to 23.3% during the pandemic period.

China remains a central player in the private gold market, experiencing a 20% growth in private gold purchases in 2024. The People's Bank of China (PBOC) officially holds 2,292 tonnes of gold as of Q1 2025, following resumed public reporting in late 2024.

However, analysts estimate that China's actual gold holdings may exceed 5,000 tonnes, including undisclosed reserves held by sovereign wealth funds and state-owned banks. This dual-track accumulation strategy allows China to build strategic reserves while minimizing market disruption and managing geopolitical perceptions.

China has consistently increased both state and private gold holdings as part of its broader strategy to diversify reserves away from U.S. dollar assets. The Shanghai Gold Exchange has become a significant trading hub, while Chinese investors increasingly view gold as a safe-haven asset amid economic uncertainty and potential currency volatility.

Russia, the world's second-largest gold producer accounting for 9% of global production in 2023, reported record production and earnings in 2024. Polyus, Russia's largest gold producer, saw adjusted EBITDA rise by 49% to $5.7 billion and net profit increase by 86% to $3.2 billion despite Western sanctions limiting access to equipment and markets.

Gold prices, which surged 27% in 2024 and 11% in early 2025, have supported Russian producers' profitability. While sanctions have created challenges for international sales, Russia has redirected much of its gold exports to Asian markets, particularly China and India, often at slight discounts to global market prices.

Within Russia, private gold ownership has been incentivized by the removal of value-added tax on gold bullion purchases in 2022, leading to increased domestic demand as citizens seek alternatives to holding foreign currencies.

Turkey has significantly increased its gold reserves in recent years, with official gold holdings rising to approximately 624 tonnes in Q1 2025, up from 615 tonnes in Q4 2024. This marks a substantial increase from just over 100 tonnes before 2011, when Turkey began accepting gold holdings from commercial banks as full-fledged reserves, integrating private gold into the official system.

"Turkey's innovative approach to gold banking has created a unique bridge between traditional cultural gold holdings and the modern financial system, effectively monetizing 'under-the-mattress' gold."

The rise of digital gold certificates traded on Borsa Istanbul has revolutionized gold investment accessibility, with certificates trading at a record 21% premium over physical gold in April 2025 due to high demand and limited supply. This premium reflects investor flight to safety amid global trade tensions and domestic economic uncertainty.

In Q1 2025 alone, around 450,000 new gold trading accounts were opened, underscoring the surge in investor interest and the growing integration of gold into Turkey's mainstream financial system.

Italy remains a key player in the global gold and jewelry market, with its jewelry industry benefiting from increased demand in countries like Turkey. The Tuscan district of Arezzo saw jewelry exports surge by 133% in Q1 2024 compared to the previous year, driven largely by Turkish demand amid inflationary pressures.

Other Italian jewelry hubs such as Vicenza and Valenza Po also experienced positive export trends. Despite the jewelry sector's growth, Italy faces challenges in other luxury goods sectors, with Florence's leather goods exports declining by 23% in Q1 2024 due to cooling demand from key markets like China.

Italy also serves as a significant supplier of gold to Turkey, with notable exports of base metals or silver clad with gold, facilitating the Turkish market's appetite for gold products. This cross-border trade in gold-related products highlights the interconnected nature of the global gold market and Italy's strategic position as both a producer and exporter of gold products.

The Reserve Bank of India (RBI) expanded its gold reserves by 40% over five years, from 618 metric tonnes in 2019 to 854 metric tonnes in 2024. Notably, 60% of these reserves are now stored domestically, shifting away from foreign custodians like the Bank of England.

Globally, central banks continued their significant gold acquisition trend in 2025, with Q1 purchases reaching 244 tonnes. Although this is a 21% decrease from Q1 2024, it still exceeds the five-year quarterly average by 25%. Central banks have been net buyers of gold every year for the past 15 years, with annual purchases exceeding 1,000 tonnes for three consecutive years.

The forecasted 12% decrease in central bank gold purchases for 2025 (from 1,045 to 920 tonnes) represents an anticipated moderation following three consecutive record years, but would still represent the fourth-highest annual acquisition on record.

Leading the central bank gold buying trend is Poland, which added 49 tonnes in Q1 2025, bringing its total reserves to 497 tonnes, representing 21% of its reserves. China also added 13 tonnes officially in Q1 2025, though its actual holdings are believed to be much higher.

Official figures likely underrepresent actual central bank acquisitions due to reporting delays and strategic off-book purchases. This trend of central bank buying has become a significant driver of gold prices and reflects growing concerns about currency stability and geopolitical risks.

The evolving patterns of gold ownership across major economies have significant implications for trade balances, recycling markets, and price dynamics. These factors interplay to create a complex global gold ecosystem with far-reaching economic consequences.

Private gold ownership across major economies reflects a complex interplay of cultural traditions, economic factors, and investment strategies. India and China continue to dominate Asian markets with strong growth in private investments, while Germany remains a European stronghold for physical gold holdings.

Turkey's rapid increase in gold reserves and innovative digital gold market highlight its evolving gold landscape, supported by strong cultural affinity and economic hedging needs. Italy benefits from this demand surge through its robust jewelry export sector, particularly to Turkey.

Central banks worldwide have accelerated gold reserve accumulation, with Poland and China leading recent purchases. This trend, combined with surging investment demand and record-high prices, underscores gold's enduring appeal as a safe-haven asset amid global economic uncertainty.

As gold prices continue their upward trajectory, the dynamics between jewelry consumption and investment demand will likely evolve further, cementing gold's role as both a cultural symbol and a strategic financial asset worldwide.