WGC: Chinese Gold Price Premium Surged in August

SEATTLE (Scrap Monster): The latest report published by the World Gold Council (WGC) analyses the gold market in China during the month of August 2022.

According to Ray Jia, Senior Analyst, China World Gold Council, local gold price premium continued to rise in the country during the month. The depreciation of local currency against dollar coupled with stronger gold consumption in China contributed to the outperformance of local gold prices. Consequently, the local gold price spread continued to trend higher in August this year.

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The wholesale gold demand continued to climb higher. However, the Chinese gold ETF gold holdings registered a decline by 7.7 tonnes, triggered by increased profit-taking activity by investors on account of rebound in gold prices in early-August. Meantime, gold imports kept surging in July, amounting to 178 tonnes, which is the highest July-level since 2017. The imports were boosted by recent strong gold demand and higher local gold price premium, WGC report said.

Looking ahead, the soft or partial lockdowns in late-August to fight Covid-19 could impact local gold consumption in the near term. Also, the wholesale gold demand may be impacted by the postponement of the annual Shenzhen Jewellery Fair, which was originally scheduled to be held in early-September.