Close X Cookies are necessary for the proper functioning of 24hGold.com. By continuing your navigation on our website, you are accepting the use of cookies.
To learn more about cookies ...
EnglishFrench
Gold & Silver Prices in

Gold Investment Demand and India, China Demand Down; Central Bank Demand Doubles

IMG Auteur
Published : August 17th, 2012
952 words - Reading time : 2 - 3 minutes
( 1 vote, 5/5 )
Print article
  Article Comments Comment this article Rating All Articles  
0
Send
0
comment
Our Newsletter...

 

 

 

 

Today's AM fix was USD 1,603.50, EUR 1,306.74, and GBP 1,021.34 per ounce.
Yesterday’s AM fix was USD 1,594.75, EUR 1,293.60 and GBP 1,016.74 per ounce.


Silver is trading at $27.91/oz, €22.81/oz and £17.85/oz. Platinum is trading at $1,401.00/oz, palladium at $574.40/oz and rhodium at $1,075/oz.


Gold rose $4.50 or 0.28% in New York yesterday and closed at $1,604.10/oz. Silver edged off and recovered to a high of $27.99 and finished with a gain of 0.07%.


Gold is floating in a tight range at $1,600/oz today and gold continues consolidating at this level.


The macroeconomic backdrop remains highly supportive with the Eurozone debt crisis far from resolved and the risk of debt crisis in Japan, the UK, India, China and the U.S. in the coming months.


US data reported yesterday clouded any certainty over the US need for imminent quantitative easing. However it is certain that the hawks and doves will have much to discuss at the upcoming Jackson Hole Economic Policy Symposium at the end of the month.




The World Gold Council released its quarterly report today, Q2 2012 Gold Demand Trends Report and can be read in full on the World Gold Council website here.


Accumulation of gold bullion from central banks was the bright spot in demand last quarter, as total demand fell 7% globally, which was driven by a 38% fall in consumer demand from India.


Price sensitive Indians have been shunning gold and many have been opting for far cheaper poor man’s gold – silver.


Jewellery and investment demand both fell. Jewellery consumption was down 72.3 tonnes at 418.3 tonnes, while investment fell 88.3 tonnes to 302 tonnes.


The report shows how while record levels of demand from western markets, China and particularly India have been followed by a decline – the seismic shift that is central banks going from being bet sellers to net buyers has provided a new fundamental pillar of support for the gold market.


Physical demand slowed down in western markets and especially in India in recent months but large buyers continue to accumulate - both hedge funds and central banks and this is providing fundamental support to gold above the $1500 to $1,600/oz level.


2Q total central bank gold purchases were double the level reported a year ago as emerging market sovereign nations sought to diversify away from the dollar and euro and heightened economic insecurity.


Gold purchases among central banks hit its highest quarterly levels (157.5 metric tons) since the sector became a net buyer of the yellow metal in 2Q 2009.


The official sector which comprises central banks and other official institutions had by comparison bought 66.2 tons in 2Q 2011.


If central banks continued to purchase gold at the current rate the official sector gold take would total nearly 500 tons this year, topping the 458 tons purchased in 2011 by the sector.



Cross Currency Table – (Bloomberg)


Central banks have become net buyers of the yellow metal increasing their reserves as a hedge against the sovereign debt crises affecting the euro and dollar. Prior to 2009, central banks had been net sellers of gold bullion for nearly 20 years.


Central banks of Russia, Saudi Arabia, Mexico, Turkey, Kazakhstan, Thailand, Ukraine and the Philippines have been recently active buyers of gold.


Kazakhstan's central bank purchased gold for its 7th month in a row this June, rapidly growing its reserves which are now 1 million troy ounces higher than last year, according to International Monetary Fund data.


There is the potential of greater demand from unreported purchases by the People's Bank of China - should they decide to again report an increase in their gold holdings.


The global banking, financial and monetary system is, to put it frankly, a mess and will take years to rectify - in the meantime gold looks set to continue gradually eking out safe haven gains.


Global gold demand is back at levels seen in 2009 which shows that the assertion that there is a gold bubble mania with ‘Joe and Jane public’, the investment and non investment world “piling into” gold is far from the case.



Gold Prices/Rates/Fixes /Volumes – (Bloomberg)


As a percentage of pension and investment portfolios and of central bank currency reserves gold allocations remain miniscule from a historical basis and miniscule when compared to allocations to more risky equities and bonds.


This suggests that the gradual increase in demand and then slight decline in demand since Q3 2011 is nothing more than then ebb and flow and is sustainable. There is a possibility that the gradual increase in demand in the coming years could give way to a more substantial increase in demand in the future.


Given the appalling fiscal and monetary backdrop, demand for gold, particularly from investors and store of wealth buyers will likely increase significantly in the coming years – as gold gradually goes from a its status as a fringe investment back to being a mainstream asset common in all investment portfolios and owned by the majority of investors and savers.


For breaking news and commentary on financial markets and gold, follow us on Twitter.

NEWS
Gold holds above $1,600/oz as stimulus hopes persist - Reuters


Central Bank Gold Demand Doubles in 2Q – Fox Business


Low volumes, central bank wait-and-see depresses Europe stocks - Reuters


Crude At Three-Month High; Gold Declines - Bloomberg

COMMENTARY

Video: Gold Prices, Demand Seen to Increase in Second Half - Bloomberg


Video: Soros and Paulson on Track as Gold May Top $2,000 - Bloomberg


Eat Big Breakfasts Without Cashing Out On Gold – The Financial Times


41 Years After The Death Of The Gold Standard - "How We Ended Up In This Economic Purgatory" – Zero Hedge


Mark O’Byrne

Goldcore

 

 

Companies Mentionned : Bullion | Gold Holdings | Gold |
Data and Statistics for these countries : China | India | Japan | Kazakhstan | Mexico | Philippines | Russia | Saudi Arabia | Thailand | Turkey | Ukraine | All
Gold and Silver Prices for these countries : China | India | Japan | Kazakhstan | Mexico | Philippines | Russia | Saudi Arabia | Thailand | Turkey | Ukraine | All
<< Previous article
Rate :Average :5 (1 vote)
>> Next article
Latest comment posted for this article
Be the first to comment
Add your comment
Top articles
World PM Newsflow
ALL
GOLD
SILVER
PGM & DIAMONDS
OIL & GAS
OTHER METALS
Mining Company News
+0.00%Ivanhoe Energy(Ngas-Oil)
appoints Randolph Thornton to Board of Directors
Nominations
+0.00%Taseko(Au-Cu-Mo)
and Curis announce completion of plan of arrangement
Corporate news
+28.57%Anaconda Min.(Au)
Announces Election of Directors
Nominations
+0.00%UR-Energy(Ur)
Completes Final Delivery on Its 2014 Sales Contracts
Corporate news
+9.09%Visible Gold Mines(Au)
announces initiation of a 4,000 kilometres airborne survey for its new project in the James B
Corporate news
-15.15%Rockwell(Cu-Gems-Ni)
arranges $4.1 million unsecured convertible Debentures
Corporate news
+3.41%Wesdome(Cu-Au)
-- Dubuisson North drilling cuts 45.05 g/t Au over 5.0 metres; new S50 East discovery, 3.39 g
Corporate news
-0.82%Fresnillo(Cu-Le-Zn)
Drilling Continues to the Southeast on the Coneto Gold-Silver Project in Durango, Mexico
Corporate news
+0.00%Gale Force Petroleum Inc.(Oil)
closes Thunder Properties sale
Corporate news
+0.00%Exall Energy(Ngas-Oil)
announces results for the three and nine months ended September 30, 2014
Corporate news
+0.00%Atna Resources(Ag-Au-Cu)
Announces Sale of Reward and Clover Properties for US$10.0 Million
Exploration and drilling
+5.94%Tristar
TORC Oil & Gas Ltd. Confirms Monthly Dividend for November 2014
Corporate news
-5.08%Talon Metals(Au)
Reports Third Quarter 2014 Results
Financials
+0.00%Orex Minerals(Cu-Au-Ag)
Concludes 2014 Fieldwork on the Jumping Josephine Gold-Silver Project
Corporate news
+2.70%Katanga(Co-Cu)
Announces 2014 Third Quarter Financial Results, Commitment of Glencore to Extend Loan Facilit
Financials
+6.67%Goldgroup(Le-Zn-Au)
Provides Corporate Update
Corporate news
-4.05%Arianne Res.(Ur-Mo-Ti)
Arianne Phosphate announces corporate and financial results for third quarter 2014
Financials
+0.00%Claude Resources(Au-Cu-Ngas)
Appoints Brian Skanderbeg as President and CEO
Nominations
-7.14%CGX(Oil)
announces Kabukalli-1 Exploration Well on the Corentyne Block and Award of Onshore Airborne S
Corporate news
+5.94%Tristar
TORC Oil & Gas Ltd. Announces Third Quarter 2014 Financial & Operational Results; A Series of
Financials
Comments closed
Subscribe to 24hGold’s daily market briefing
  • Prices and data of precious metals in 119 currencies and world mining companies
  • Daily analysis of the economy, markets and more
  • Free, daily and indispensable
Stay informed, subscribe now !
* Your email will never be shared.