While China is gorging on gold, India is now inflaming silver. This explains, according to the market, the record after record recorded in recent weeks….
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While the China it is stuffed with gold, now India is inflaming silver. They explain themselves like this, according to the market, the record after record recorded in recent weeks. But let’s go in order. Gold has already metabolised the downsizing of the Fed’s prospects of easing monetary policy scheduled for 2024 and has started to grind out increases again to exceed 2,400 dollars an ounce. Relentless demand for physical metals from China and the Middle East has something to do with it, say Ned Naylor-Leyland and Daniel March, managers of Jupiter AM’s Gold & Silver fund. Amid inflationary concerns and growing geopolitical tensions in the Middle East, China has become one of the most important buyers of gold in the world. The numbers prove it. The China Gold Association (CGA) says the country’s gold consumption in 2023 amounted to nearly 1,090 tonnes, an increase of 8.73% from the previous year.
And another indicator of overall demand for gold in China, the Shanghai Gold Exchange (SGE) recorded a 95% increase in demand (year-on-year) in January. Not only. The most interesting thing, however, is that behind this phenomenon there is a demographic shift. Younger buyers, aged between 25 and 34, increased their share of overall gold purchases from 16% to 59% in 2023. A trend contributed to by the decline in the stock market and local property values . But it is the form of investment that indicates the true nature of demographic change. Younger buyers in China are choosing to purchase 1 gram gold beans to preserve long-term wealth.
At the same time, thesilver is in the spotlight in India, which last month imported a record 70 million ounces (about 2,200 tonnes) of silver, with silver pellets accounting for more than half of total imports. The main goal is to stockpile granules for industrial uses, in light of plans to launch an electronic vehicle gigafactory. But it is possible that behind the large import flows from London there is also a bet on a metal considered cheap, given the gold/silver ratio that is still very high, close to 90 to 1. If I can’t get to one, in the meantime I’ll bet on else, it must be logic.
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