Gold demand slumped to its weakest first quarter since the global financial crisis, the World Gold Council said Thursday, as the prospect of rising interest rates led investors to pursue greater returns elsewhere.

Worldwide demand for gold totaled 973.5 tons in the first quarter of the year, according to the Council's latest report, down 7 percent year-on-year. The slump in demand for the precious metal also coincided with prices holding within their narrowest range of any quarter in more than a decade.

The trade group that represents the commodity blamed the fall on a 15 percent dip in investment in gold bars to 254.9 tons, as investors in the U.S., China and Germany held off from buying the yellow metal.



"Relatively solid global economic growth, coupled with the return of volatility in the capital markets in February, created a stable environment for gold in (the first quarter)," Alistair Hewitt, head of market intelligence at the World Gold Council, said in a statement.