(Reuters) -China’s net gold imports via Hong Kong in October fell about 64% from September, Hong Kong Census and Statistics Department data showed on Tuesday.
WHY IT’S IMPORTANT
As the world’s leading gold consumer, China’s purchasing activities can significantly influence global gold markets.
The Hong Kong data may not provide a complete picture of Chinese purchases, as gold is also imported via Shanghai and Beijing.
BY THE NUMBERS
Net imports via Hong Kong to China for October stood at 8.02 metric tons, compared with 22.047 tons in September.
China’s total gold imports via Hong Kong reached 30.08 tons in October, down 17% from 36.275 tons in September.
KEY QUOTE
“What we’re really seeing here is a weakness in the Chinese demand while they have been firmly strong earlier in the year,” said Ross Norman, an independent analyst.
“Domestic demand is probably being met locally. So the market’s kind of looking after itself to some extent.”
CONTEXT
Last week in China, bullion traded at prices ranging from at par to a discount of $5 an ounce compared with the global benchmark spot price. [GOL/AS]
Demand in China was lacklustre last month, with discounts of about $48-$60 an ounce being offered to attract buyers.
Swiss gold exports to China in October plunged 93% to 2.1 tons as elevated prices squeezed Chinese demand, data showed last week.
Meanwhile, Beijing on November 1 cut a value-added tax exemption for certain gold purchased through the Shanghai Gold Exchange and the Shanghai Futures Exchange, a move expected to push up costs for gold used in jewellery and industry.
However, China’s central bank added gold to its reserves in October for the twelfth straight month. The bank’s gold holdings increased to 74.09 million fine troy ounces at the end of October from 74.06 million in the previous month.
Spot gold prices hit a record high of $4,381.21/oz on October 20, driven by geopolitical tensions, economic concerns, easing U.S. monetary policy, de-dollarization, and strong gold-backed exchange-traded fund inflows. [GOL/]
(Reporting by Noel John in BengaluruEditing by Mark Potter)
