Jakarta. Gold’s appeal as a safe-haven investment is expected to continue driving significant investor demand in 2026, with ongoing geopolitical tensions likely to support the precious metal’s fortunes, the World Gold Council (WGC) said Wednesday.

Shaokai Fan, Head of Asia Pacific (ex-China) and Global Head of Central Banks at the WGC, said that despite elevated prices, investors are not yet taking profits, indicating sustained interest in gold as a long-term investment.

“The market is seeing more and more investors entering gold to take advantage of what could be a huge investment opportunity,” Shaokai said at the “Gold Demand Trends Q4 & Full-Year 2025” event in Jakarta.

Gold prices surged in 2025, with an average fourth quarter price of $4,135 per ounce, up 55% year-on-year, leading to a record annual average of $3,431 per ounce, up 44% from 2024.

Total global gold demand exceeded 5,000 tons for the first time, fueled by record-setting prices and 53 all-time highs during the year. This generated a total market value of $555 billion, a 45% increase over the previous year.

Gold ETFs, investment funds that track gold prices and trade on stock exchanges, saw holdings rise by 801 tons, the second-strongest annual gain on record. Demand for gold bars and coins also reached a 12-year high. Central banks purchased 863 tons of gold in 2025.

“Safe-haven and diversification motives consistently drove investment interest throughout the year, alongside price-driven motivations,” Shaokai said.

While jewellery demand declined in volume due to record-high prices, sentiment toward gold jewellery remained positive, with total value climbing 18% to a record $172 billion.

In Indonesia, bar and coin demand is rising, driven by domestic economic uncertainty, a weakening local currency, and safe-haven considerations. This trend has also prompted a shift in jewellery purchases toward lower-carat products, below 14k.

“Indonesia’s total gold demand increased 2% year-on-year. While slightly below some neighboring countries, it remains broadly in line with the global average,” Shaokai said.

Looking ahead, the WGC expects strong inflows into gold ETFs and continued robust bar and coin demand in 2026, supported by ongoing central bank buying. Jewellery demand is likely to remain weak if prices stay high.

“Bond market uncertainty, expected policy rate cuts, and pressure on the US dollar are likely key factors supporting continued strength across gold investment sectors,” Shaokai said.

He added that while jewellery spending should remain stable barring economic shocks, tonnage demand may mirror 2025’s subdued levels.  Meanwhile, Central bank demand is expected to be solid at levels close to those in 2025