Chinese Gold, Silver Demand Has Fallen Off

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Falling demand in Hong Kong is a serious blow to gold. The city is the trading hub for China, the world’s largest consumer. Buyers typically step up purchases in late November to use as gifts for Lunar New Year celebrations early in the following year, but gold’s decline comes as investors elsewhere are also ditching the safe-haven metal for riskier assets such as equities, sending gold plummeting in recent months.

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The Wall Street Journal reported over-the-counter sales are down 20% in Hong Kong. A report on third-quarter demand by the World Gold Council, an industry group, said Chinese consumers are increasingly buying 18-carat gold jewelry, rather than rings and necklaces in pure 24-carat gold, a shift that it said may have resulted in part from the effort to fight corruption.

The price of Chinese silver closed as the biggest mover for Tuesday, December 2. Switching from a downward trend, the metal closed at CNY 3,500 ($568.67) per kilogram following a 8.2% increase. The price of US silver increased 1.0% to $16.46 per ounce. Indian silver saw its price rise 0.2% to INR 37,440 ($604.47) per kilogram. After a couple of days of decreasing prices, the price of Japanese silver held steady at JPY 563.00 ($4.76).

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Following a 4.5% rise on Tuesday, the price of Chinese gold bullion closed at CNY 238.26 ($38.71) per gram. Indian gold bullion rose 3.0% to INR 27,086 ($437.30) per 10 grams. US gold bullion gained 1.4% to finish at $1,213 per ounce. The price of Japanese gold bullion flattened at JPY 4,399 ($37.18) following two-days of declines.

Following a two-day drop, the price of Chinese platinum bar increased by 2.4% to CNY 258.00 ($41.92) per gram. Following a couple of essentially changeless days, the price of US platinum bar rose by 0.7%, closing at $1,234 per ounce. Following two days of downward movement, the price of Japanese platinum bar held steady at JPY 4,553 ($38.48) per gram.

The price of Chinese palladium bar nudged up 0.6% on Tuesday, closing at CNY 177.00 ($28.76) per gram. After a 0.4% increase, US palladium bar finished the day at $805.00 per ounce. Following a two-day rise, the price of Japanese palladium bar flattened at JPY 3,065 ($25.90).

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