Gold's safe-haven appeal fails to lift demand in Asia

Golds safe-haven appeal fails to lift demand in Asia
There is a slight increase in buyers hunting for gold who see it as a safe haven.

Mumbai/Bengaluru - Benchmark global spot prices head for biggest weekly gains in three

By Reuters

Published: Fri 28 Dec 2018, 6:31 PM

Last updated: Fri 28 Dec 2018, 8:33 PM

Physical gold demand lacked vigour in most Asian hubs this week as limited safe haven interest failed to lift activity into the year end, while jewellers in India stepped up purchases, hoping for a further leg to a rally in domestic rates.
Benchmark global spot gold prices were headed for their biggest weekly gains in three on renewed interest for the metal due to concerns over a slowdown in global growth, heightened volatility in stock markets and political instability in the United States.
The physical gold market has been quiet with most players out due to the holidays, said Brian Lan, managing director at dealer GoldSilver Central in Singapore.
"On the retail side, we are seeing a slight increase in the number of people hunting to purchase gold since they see it as a safe haven right now."
Premiums in top consumer China eased to a $3-$7 an ounce range from last week's $5-$6.50.
In Hong Kong, premiums were little changed at 80¢-$1.30 from 70¢-$1.20 last week.
In Singapore, premiums of 60¢ to $1.50 were charged over the benchmark, versus last week's 50¢-80¢ level. "We are seeing gold and silver prices starting to move up now. In an asset which has been boring, we're seeing a bigger number of buyers, but not so the big ones yet," said Gregor Gregersen, CEO of Singapore retailer Silver Bullion.
In Japan, gold continued to be sold at par with the benchmark, although there is limited buying emerging, a Tokyo-based trader said.
Meanwhile, there was a marginal uptick in second-biggest consumer India, with some jewellers stocking up in anticipation of a further rally in prices. Jewellers were making small purchases even as prices rose, tracking a rally in global rates, said Harshad Ajmera, the proprietor of JJ Gold House, a wholesaler in Kolkata.
Local gold prices jumped to a more than a two-week high following gains in the overseas market this week. Dealers in India were offering a discount of up to $2 an ounce over official domestic prices, unchanged from the prior week. The domestic price includes a 10 per cent import tax.
"Retail buying is subdued due to year-end vacations and Khar Mass," said a Mumbai-based dealer with a bullion importing bank.
Prices at 6-month high
Meanwhile, gold scaled a six-month peak on Friday, supported by a weaker dollar, worries over global economic growth and stock market tumult, for a second consecutive week of gains.
Spot gold was up 0.24 per cent at $1,278.17 per ounce as of 1205GMT, and up 1.8 per cent so far this week. Earlier it had peaked at $1,282.09, its highest since June 19. US gold futures were steady at $1,280.80 per ounce.

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