SEATTLE (Scrap Monster): The latest report on Chinese gold market published by the World Gold Council (WGC) indicates that the country’s gold market demand recorded improvement on multiple fronts during the month of August.
According to Ray Jia, Senior Analyst, China World Gold Council, the industry withdrew 161 tonnes of gold from the Shanghai Gold Exchange (SGE), registering notable rise from the previous months. The tight local demand and supply conditions sent average Shanghai-London gold price premium to record high in August 2023.
The Chinese gold exchange-traded funds (ETFs) reported third straight month of inflows in August. The ETFs added $239 million during the month, thus lifting the total assets under management (AUM) to $4 billion. The Chinese central bank recorded tenth consecutive month of gold purchases. The bank added 29 tonnes of gold to its reserves, boosting the total reserves to 2,165 tonnes.
Looking ahead, the improved outlook for Chinese economy is expected to provide some support for local gold demand, despite challenges. The demand will see an uptick, aided by a series of jewellery fairs and other industry events. This will be further boosted by the upcoming National Day Holiday and Mid-Autumn Festival. However, the record RMB gold price may deter local gold consumption, WGC noted.
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