Worldwide Appetite for Gold Slumps 16% in 2Q 2014 – WGC
By Esther Tanquintic-Misa | August 14, 2014 4:17 PM EST
The world's appetite for the safe haven yellow metal gold has dropped in the second quarter of 2014 by as much as 16 per cent compared a year ago, the World Gold Council said on Thursday.
Senior refinery technician Vincente Sandoval puts a gold "button" into a furnace to be further refined to form gold dore bars at Newmont Mining's Carlin gold mine operation near Elko, Nevada May 21, 2014. The dore bars contain approximately 90 percent gold, 8 percent silver and 2 percent trace material. Picture taken May 21. REUTERS/Rick Wilking (UNITED STATES - Tags: BUSINESS COMMODITIES)
On a global wide scale, purchases of gold dropped 16 per cent to 963.8 metric tonnes from the 1,148.3 tonnes a year ago.
"Buyers in China and India were waiting to see a price trend develop," Marcus Grubb, managing director of investment strategy at the council, told Bloomberg. "It's a market still returning to its fundamentals. It was an exceptional year and quarter last year."
Grubb likewise said they expect India's appetite for gold to further decelerate to 850-900 tonnes in the full year, while China, the world's largest gold market, down to 900-1,000 tonnes.
Overall global jewelry demand fell in the latest quarter to 509.6 tonnes. WGC said China's purchases dropped 45 per cent, while India's was an 18 per cent drop.
The gold purchases of these two countries combined account for 60 per cent of world jewelry consumption.
"The data confirms our view that Chinese gold demand will stay relatively weak compared with 2013, which only serves to drag gold prices lower into the second half," economist Barnabas Gan said.
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