Last year saw the largest volume increase in gold jewelry demand for 16 years as consumers across the globe reacted to lower gold prices, according to a report the World Gold Council released on Tuesday.

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Full year gold jewelry demand for 2013 was 2,209.5 metric tons worldwide, 17 percent more than in 2012 and the highest level since the onset of the 2008 financial crisis.

The report also said demand for bars and coins surged to an all-time high of 1,654.1 tons as individual investors took advantage of lower prices, while large-scale selling of more tactical exchange traded fund positions by Western investors generated outflows of 880.8 tons.

Annual demand for gold used in technology stabilized at 404.8 tons in 2013, from 407.5 tons in 2012. The lower price environment and improved global economic outlook was supportive for gold used in a range of applications in the sector.

Net purchases by central banks increased global official gold reserves by 368.6 tons. Last year was the fourth consecutive year of net purchases, albeit at a slightly reduced pace due to the environment of heightened gold volatility and slower foreign reserve accumulation.

In 2013, the supply of gold declined 2 percent to 4,339.9 tons as a drop in recycling activity (in response to lower gold prices) more than offset growth in mine production.

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