Gold demand slid to eight-year low, 22k priced at Dh152.75 in Dubai

Dubai - Gold prices in Dubai saw slight rise from yesterday's Dh161.75 to Dh162.75 today.

A late rally in physical gold buying failed to prevent a drop in full-year demand last year to its lowest since 2009, the World Gold Council said on Tuesday, as weaker fund investment outstripped a bump in jewellery consumption.
Global gold demand slid 7 per cent in 2017 to 4,071.7 tonnes, an eight-year low, the WGC said in it latest quarterly demand trends report.
Meanwhile in Dubai, gold prices are Dh162.75 for 24-karat and 22-karat can be bought for Dh152.75.
Investment demand fell by nearly a quarter, driven by reduced inflows into bullion-backed exchange traded funds, the gold mining industry-funded WGC said. While gold prices rose last year on the back of dollar weakness, rising interest rates and a surge in stock markets detracted from the metal's appeal as an investment.
"Certainly the higher equities and rising interest rates will have prompted some investors to think about their allocation to gold (last year)," the WGC's head of market intelligence Alistair Hewitt said. "That said, lots of investors are concerned about frothy asset prices."
With monetary policy still loose in Europe, 73 percent of new gold ETF investment last year flowed into European funds, he said. "In Europe, you still had negative interest rates and negative yields," he said. "You can contrast that with the United States, where you had three rate hikes."
Optimism over global growth, which helped drive the rise in equities last year, also fed into stronger jewellery consumption, he said. Jewellery demand saw its first annual rise since 2013 despite a 13 percent increase in gold prices.
Indian jewellery demand, which saw particular weakness in 2016, rose 12 percent, posting its strongest fourth quarter since the WGC started compiling data in 2000. In China, jewellery demand rose 3 percent last year, its first annual increase since 2013.

• Gold and Forex