China’s June gold imports via HK lowest in five months
CHINA’S net gold imports via Hong Kong fell by about 29 per cent to their lowest in five months in June, reflecting a sluggish economic recovery in the world’s top consumer of the metal.
Net gold imports into China stood at 34.648 metric tons in June, compared with 49.056 metric tons in May, Hong Kong Census and Statistics Department data showed on Tuesday (Jul 25).
Total gold imports via Hong Kong slipped 26 per cent to 38.395 metric tons, as per the data. Swiss gold exports to China also fell by a third in June, data showed last week.
“Retail demand is still sluggish, as buyers are concerned about the economic outlook and this is constraining spending,” StoneX analyst Rhona O’Connell said.
The world’s second-largest economy grew at a frail pace in the second quarter as demand weakened at home and abroad, raising pressure on policymakers to deliver more stimulus to shore up the post-Covid recovery.
China’s top leaders pledged on Monday to step up policy support for the economy, which could boost bullion consumption.
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Citi projects China’s gold jewellery demand this year will reach about 700 metric tons, up 22 per cent on a yearly basis and the strongest since 2017. Consumer-focused stimulus in China could enhance this outlook, Citi analysts wrote in a note.
Data earlier showed the country’s gold consumption rose more than 16 per cent year-on-year to 554.88 metric tons in the first half of the year. The consumption figure excludes reserve purchases by the People’s Bank of China.
China has not issued any fresh quotas to commercial banks to import gold, analysts told Reuters.
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O’Connell said this would make sense, as the People’s Bank of China is looking to defend the currency. This, rather than an increase in demand, is why premiums are nudging higher, she said.
The physical gold premium in China rose to as high as US$15 over global benchmark spot rates towards the end of last month. REUTERS
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