Gold demand in Türkiye reached a new record in value terms in the first quarter, driven by strong investor appetite for bar and coins, industry data showed on Wednesday.
The precious metal is seen as a safe-haven asset in times of volatility, and Turks have long seen it as a portable, tangible store of wealth.
Bar and coin demand in Türkiye rose 29% year-over-year in the January-March period to 26.1 metric tons, according to a report by the World Gold Council (WGC).
That marked the highest level in seven quarters.
In value terms, the bar and coin demand hit a record $4.5 billion, based on an average gold price of about $4,872 per ounce during the quarter, the report said.
Gold touched a new record just shy of $5,600 per ounce at the end of January, as investors sought refuge from a weak dollar and U.S. President Donald Trump's erratic policy shifts.
However, it has been declining since late February after the Iran war forced some investors to liquidate holdings to raise cash.
Türkiye has among the highest levels of household gold ownership in the world. Record gold prices are said to have lifted the value of the Turks' holdings to nearly half the size of Türkiye's $1.57 trillion economy.
The precious metal, given as gifts at weddings and passed down through generations, is a hedge against inflation and a permissible investment under Islamic tradition that spurns interest-bearing banking.
According to the Turkish central bank, about $600 billion of the total stock is "under‑the‑mattress," or "under-the-pillow" in Turkish: gold held by households and companies outside the banking system.
Worldwide, gold demand also reached record levels in monetary terms in the first quarter, according to the WGC.
Including over-the-counter (OTC) transactions, the demand increased 2% year-over-year to 1,231 tons in the first quarter, while the total value of demand surged 74% to a record $193 billion as rising prices boosted market volumes.
Physical investment demand, including bars and coins, climbed 42% annually to 474 tons, representing the second-strongest quarterly performance on record. The increase was largely driven by Asian investors seeking protection against market volatility and inflation concerns.
Gold-backed gold exchange-traded funds (ETFs), an easy means to invest in the precious metal, recorded inflows of 62 tons during the quarter. However, the figure remained well below the 230 tons recorded in the first quarter of 2025, mainly due to heavy outflows from U.S.-based funds in March.
Central banks remained net buyers of gold despite increased selling activity during the quarter, purchasing a net 244 tons, up 3% from a year earlier.
High prices, driven largely by investment holdings, and the Iran war hit demand for jewellery, however.
The WGC said jewelry demand volumes fell 23% from a year ago. Total spending still increased 31% as higher prices offset lower purchases.
Following the U.S.-Israeli attacks on Iran at the end of February, Tehran closed traffic through the Strait of Hormuz, through which a fifth of the world's oil and liquefied natural gas normally flows.
That sent oil and gas prices rocketing higher and disrupting markets, forcing many investors to raise cash to settle their positions.
The prospect of the U.S. Federal Reserve (Fed) raising interest rates in response to higher inflation boosted the dollar, making gold more expensive for investors who don't hold dollars.
