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London--Consumer demand for gold jewelry continued its slide in the U.S. market, declining in both volume and value terms last year, the latest data from the World Gold Council (WGC) shows.

According to the WGC’s Gold Demand Trends report for the full year 2012, demand for gold jewelry in the United States fell 5 percent in volume terms and 3 percent in value terms year-over-year in the fourth quarter.

For the full year, U.S. demand for gold jewelry slipped 6 percent in volume terms and was down 2 percent in value terms.

The United States was not the only Western market to witness demand for gold jewelry continue to drop, not because consumers don’t want gold but because the price remains too high.

“A further erosion of tonnage in the Western markets was again caused by consumers reacting to higher prices during a prolonged period of economic distress,” the council said. “Although silver tonnage has been seen gaining at the expense of gold, it is interesting to note that much of this will be in the form of gold-plated jewelry, confirming that the desirability of pure gold jewelry, which is being undermined by affordability.”

Globally, in the fourth quarter demand for gold jewelry in value terms climbed 13 percent to $29.1 billion, the strongest quarter for demand since the beginning of 2011. Demand in India, and to some extent Middle Eastern markets, drove the increase.

For the year, however, demand for gold in volume terms fell 3 percent. In value terms, gold jewelry demand reached a record $102.4 billion, a 3 percent increase from 2011. India and China were the world’s two largest markets for the consumption of gold jewelry, accounting for 56 percent of global demand.

In the fourth quarter, the gold price was up 2 percent year-over-year, from $1,688 to $1,721.80 an ounce. For the year, the average price of gold was $1,669 an ounce, up 6 percent from $1,571.50 in 2011.

The average price of gold varied from quarter to quarter in 2012 but never dipped below $1,600 an ounce, WGC data shows. The metal’s lowest average per-ounce price for the year, $1,609.50, occurred in the second quarter before climbing to $1,652 in the third quarter and peaking at $1,721.80 in the fourth.