Despite rising prices and limited alternatives, AI-powered electronics are driving a golden boom, with soaring demand for gold in devices like smartphones and self-driving cars.
The growing reliance on artificial intelligence (AI) in devices like smartphones, self-driving cars, and data centres has led to a rise in gold demand, owing to its unique properties, according to a report by the World Gold Council.
As per the report, while gold demand in electronics reached a high of 328 tonnes in 2010, it gradually dropped to 249 tonnes by 2023. However, recent quarters have shown a slight rebound, partly driven by the growth of AI-powered devices.
Manufacturers are striving to meet AI’s technological demands, and gold’s unique properties ensure its continued significance in high-performance electronics. Its exceptional electrical conductivity and corrosion resistance make it indispensable for advanced hardware components, allowing for efficient data processing, minimising energy loss, and ensuring long-lasting durability.
Sectors like healthcare and finance are investing heavily in AI to drive innovation and improve efficiency, which in turn increases demand for gold. According to the Economic Times, as these industries increasingly depend on AI, gold’s role in providing reliable and efficient electronic components becomes even more critical. From processors to sensors, gold is a key material for enabling AI technology.
As the World Gold Council report says, the rising price of gold, which recently exceeded Rs 72,056 per 10 grams (USD 2,700 per ounce), is creating challenges for manufacturers.
In past instances of price increases, such as between 2001 and 2011, industries responded by replacing gold with alternatives like silver or copper and employing thrifting methods to reduce usage. However, most of the reductions have already been made, leaving limited room for further cost-saving without affecting performance.
Despite technological advancements, such as the rise of gold-free mini-LEDs in areas like LED production, the increasing complexity of AI systems is expected to sustain gold demand.
Beyond AI, gold’s versatility keeps it valuable in other industries. In healthcare, it is used in therapeutic devices and as an essential part of diagnostic tools and experimental drug delivery systems. In aerospace, gold helps protect sensitive satellite and spacecraft components from extreme temperatures and radiation.
Additionally, in clean energy technologies, gold is used as a catalyst in processes like hydrogen production and carbon dioxide conversion.
