China Gold Imports Drop for Fifth Month on Weak Demand

August 27, 2014 Posted by admin

China’s gold imports from Hong Kong
in July fell by 42 percent from a month earlier as an anti-corruption campaign and price declines deterred Chinese
consumers.

Net imports totaled 21.1 metric tons, compared with 36.4
tons in June and 113.2 tons a year earlier, according to
calculations by Bloomberg News based on data from the Hong Kong
Census and Statistics Department today. Exports to Hong Kong
from China fell to 17.9 tons last month from 19.7 tons in June,
the statistics department said in a separate statement. Mainland
China doesn’t publish such data.

The continued weakness adds to signs of slowing demand in
China, which in 2013 overtook India as the biggest user after
gold entered a bear market, spurring a buying frenzy among
Chinese consumers. President Xi Jinping’s anti-graft drive this
year hurt demand for luxury goods, according to the World Gold
Council. Prices fell by the most since December last month amid
bearish forecasts from banks including Goldman Sachs Group Inc.

“All signs continued to show that gold demand really fell
victim to the weak consumer demand,” Liu Xu, an analyst at
Capital Futures Co. in Beijing, said before the data came out.

China’s consumption plunged 52 percent to 192.5 tons in the
second quarter this year from a year earlier as buyers purchases
fewer bars, coins and jewelry amid a clampdown on corruption,
the London-based council said in an Aug. 14 report.

Gold will drop to $1,050 an ounce by the end of 2014 as the
U.S. recovery accelerates, according to Goldman.

Bullion for immediate delivery in London fell 0.3 percent
to $1,277.86 an ounce at 5:21 p.m. Beijing time, according to
Bloomberg generic pricing. Prices are down 0.4 percent this
month after losing 3.4 percent last month. Bullion of 99.99
percent purity on the Shanghai Gold Exchange fell 1.6 percent in
July.

Mainland Chinese buyers purchased a total 38.9 tons in July
including scrap, compared with 56.1 tons in June and 129.2 tons
a year earlier, data from the Hong Kong government showed.

To contact Bloomberg News staff for this story:
Feiwen Rong in Beijing at
frong2@bloomberg.net

To contact the editors responsible for this story:
Ramsey Al-Rikabi at
ralrikabi@bloomberg.net
Sungwoo Park

Article source: http://www.bloomberg.com/news/2014-08-25/china-gold-imports-drop-for-fifth-month-on-weak-demand.html

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