Although mainland China’s gold imports from Hong Kong fell in June, analysts expect imports from the Far East to increase in the coming months. Data released from the Hong Kong Census and Statistics Department showed that China’s imports via Hong Kong fell by 48% month over month, and by 8% year over year, to the lowest level since August 2014, says Simona Gambarini, commodities economist for U.K.-based research firm Capital Economics.
She adds that this data suggests that gold’s price drop still has to feed through into higher buying. “However, we expect total imports by China and India to pick up in the second half of the year as low prices attract a fresh wave of buying,” she says. Gambarini adds that the Swiss Federal Customs Administration also revealed that China’s imports via Switzerland fell in June by 25% month over month, but are up 368% year over year.
“We think investors are becoming increasingly worried about a more pronounced correction in China’s stock market and will return to gold to diversify their portfolios,” she notes. As such, she adds that the firm expects an overall increase in consumer demand of 4% from India and 3% from China year over year.
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