The World Gold Council (WGC) predicted demand for gold in Hong Kong, the mainland and Taiwan should rise this year after record global interest for the precious metal in the last quarter of 1998. Releasing its quarterly Gold Demand Trends report, the WGC said aggregate demand for last year in Hong Kong, the mainland and Taiwan had collapsed by 23 per cent to 314.6 tonnes. It blamed the Asian financial crisis, but said the previous Year of the Tiger was considered inauspicious for weddings and other occasions traditionally marked by gold gifts - further depressing demand. 'The situation showed no signs of improvement at the year-end with [fourth quarter] demand at 78.3 tonnes, 25 per cent lower than a year earlier, although the more auspicious Year of the Rabbit should help to boost sales in 1999,' the WGC said. The fall in Hong Kong, the mainland and Taiwan demand for gold contrasted sharply with the rest of the world where demand soared to 806.6 tonnes, about 6 per cent above the fourth quarter of 1997 and just ahead of the previous record for any quarter. 'The story of 1998 was of a growing appreciation of the role of gold as a monetary asset,' said WGC gold market analysis manager George Milling-Stanley. 'There were continued strong gains in the demand for gold as an investment. 'In the USA, Y2K fears and concern about a possible correction in the stock market drove coin purchases to an all-time record. 'In Japan, the Big Bang financial reforms triggered a renewed interest in gold's value in portfolio diversification, while in the countries worst hit by the Asian crisis, investment demand in the fourth quarter was already back up to pre-crisis levels.' The WGC said the mainland was the least affected by the financial crisis, and sales of 191.6 tonnes were only 10 per cent down for the year. In the fourth quarter demand dropped by 15 per cent to 47 tonnes as growing unemployment and slower economic growth began to bite into demand. The WGC noted that the People's Bank of China had also sought to bring domestic gold prices closer in line with international markets.