Explaining the reasons for the rising demand, Cheng said that the April pull back in prices from $1600 levels earlier to below $1300 levels attracted buyers who were waiting on the sidelines to plunge into more buying.
ROME, ITALY: China could become the world's top gold consumer in 2013 surpassing India if present market activity is any indication according to Albert Cheng, a China representative in the World Gold Council (WGC). India imports meanwhile could fall to less than 750 tons annually, according to government officials.
In an interview to Daniela Cambone of Kitco News at the venue of the LPPM Precious Metals Conference in 2013, he said that China's gold consumption could cross 1000 tons for the first time this year as the nation enters a seasonally strong demand for the metal in the last quarter of the year.
Explaining the reasons for the rising demand, Cheng said that the April pull back in prices from $1600 levels earlier to below $1300 levels attracted buyers who were waiting on the sidelines to plunge into more buying.
Traditionally, women were the buyers of gold but now more and more men are buying gold jewellery either for themselves, for investment purposes or to gift them. ETF demand is also risign with more white collar workers using the convenience to invest in exchange traded products to make profits.
Indian demand week
India also enters a seasonally strong period for gold and silver as festivals and wedding season enhance demand for jewellery and coins. However, this year, the government had steeply increased the import duty to 10% and also raised imported jewellery customs duty from 10 to 15%. It also took several measures to curb gold loans and bank financing for gold jewellery. Morever, as per a new regulation, one fifth of imported gold has to be re-exported in value added form thus weakening the demand for the yellow metal.
India imported 47.5 tonnes in July, worth $2.9 billion, but the figure slipped to only $0.65 billion in August. Volumes for August are not yet available. Last fiscal year, imports averaged 70 tonnes a month.
India's total gold imports could now be below 750 tonnes in the year to March 2014, Arvind Mayaram, economic affairs secretary at the finance ministry said recently. This represents a decline of about 11 percent lower than a year ago.
courtesy of bullionstreet
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