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China gold demand down 19% as Ukraine, Middle East unrest hurts consumption

Peter Kennedy Peter Kennedy, Stockhouse
4 Comments| July 23, 2014


China’s gold demand fell 19% in the first six months of this year as investors bought fewer bars and coins, offsetting increased demand for jewelry, the China Gold Association said, according to a Bloomberg report.

Consumption in China, which passed India last year as the world’s biggest user, slid to 569.5 tonnes, the Beijing-based association said in a statement that was reported by Bloomberg.

Demand for bars sank 62%, while gold use in jewelry rose 11%, according to the statement.

An 8.9% price rise this year amid unrest in Ukraine and the Middle East has hurt consumption in China, which is expected to be “more or less the same” on a full-year basis in 2014, Zhang Bingnam, vice-chairman and general secretary at the association, said in an interview with Bloomberg in Singapore last month.

Spot gold was off US$1.705 to US$1,305 an ounce on Wednesday.

Shares of Barrick Gold Corp. (TSX: T.ABX, Stock Forum) were off 0.10% to $20.19, leaving a market cap of $23.5 billion, based on 1.2 billion shares outstanding. The 52-week range is $23.78 and $16.19.

Martin Murenbeeld, Chief Economist at Dundee Capital Markets said the China Gold Association report is not much of a surprise given that 2013 was an usual year as buyers in China were fighting each other off in a bid to buy gold at around the US$1,300 an ounce level, a price that was considered cheap at the time.

A veteran gold analyst, based on Vancouver Island, British Columbia, Murenbeeld said it’s a matter of opinion how geopolitical issues will impact the yellow metal in the near term. 

“In my opinion, things are likely to get worse before they get better,’’ he said.

If that’s the case, it will lead to an uptick in the price of gold, he said.

Meanwhile, to get a true picture of gold demand in China, Murenbeeld said analysts monitor imports from Hong Kong and deliveries through the Shanghai Gold Exchange.

“We kind of think that overall demand (in China) will be down this year,’’ he said.

Tags: GOLD

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Comments

saini
there is the truth and your bs post...China is heading to 2000 plus tons this yr...Silver should hit 5000 tons plus...and the truth is what China and India are saying..and I looked and did read According to the SGE reports published every friday on the previous trading week, Chinese wholesale gold demand year to date, as measured by SGE withdrawals, came in at 998 metric tonnes at the end of July 11 2014 - at the time of writing it surely has passed 1000 tonnes.
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July 23, 2014
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threepalms
Hilarious.... Anyone who buys into this headline is buying into a bunch of who wash. The Asian demand for precious metals the last few years is HUGE. That is the story. All that needs to be seen now is who will profit from the history of fiat currencies repeating itself?
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July 23, 2014
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saini
you full of sht...dude SGE reports published every friday on the previous trading week, Chinese wholesale gold demand year to date, as measured by SGE withdrawals, came in at 998 metric tonnes at the end of July 11 - at the time of writing it surely has passed 1000 tonnes./ India Imported 713 MT Of Silver In April, 1921 MT YTD Precious metals analysts have received a few gifts from the authorities this year. In January the Swiss Customs Administration (SCA) decided to disclose their gold tra...
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July 23, 2014
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saini
peter blog the truth man...really ..where is it down that is total BS SGE reports published every friday on the previous trading week, Chinese wholesale gold demand year to date, as measured by SGE withdrawals, came in at 998 metric tonnes at the end of July 11 - at the time of writing it surely has passed 1000 tonnes./ India Imported 713 MT Of Silver In April, 1921 MT YTD Precious metals analysts have received a few gifts from the authorities this year. In January the Swiss Customs Administ...
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July 23, 2014
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