China’s net gold imports via Hong Kong at 10-month high in December

CHINA’S net gold imports via Hong Kong jumped about 37 per cent to their highest level in 10 months in December, data showed on Thursday (Jan 25), as the approaching Chinese New Year lifted demand in the world’s top gold consumer.

Net imports stood at 50.381 tonnes in December, the highest level since February, and were up from 36.801 tonnes in November, data from the Hong Kong Census and Statistics Department showed.

Total gold imports via Hong Kong, which include re-exports, were up 29 per cent at 59.589 tonnes.

“With New Year celebrations due to start early next month this is not a surprise,” said StoneX analyst Rhona O’Connell.

The Chinese New Year, a key occasion to buy gold, starts on Feb 10.

“The government’s defence of the currency has meant that there has been little news of any quota permits and this, combined with increasing demand at the retail level, propelled the domestic premium up towards US$50,” O’Connell said.

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The People’s Bank of China controls the amount of gold entering the country via quotas to commercial banks.

Last month, Chinese dealers sold gold at premiums of anywhere between US$12 and US$45 an ounce over global benchmark spot prices, compared with the US$20 to US$58 range seen in November.

The Hong Kong data may not provide a complete picture of Chinese purchases, as gold is also imported via Shanghai and Beijing. REUTERS