Singaporeans queueing up to buy the dip in gold despite rout
At UOB’s headquarters, Singapore’s only bank selling physical gold, buyers crowd a lounge for bullion trades
[SINGAPORE] People were still queueing up to buy gold in Singapore on Monday (Feb 2) even as prices plummeted, showing the extraordinary resilience in retail demand for precious metals.
At the headquarters of UOB, Singapore’s only bank offering physical gold products to retail investors, clients and walk-in buyers crowded into a dedicated lounge for bullion transactions.
“I came to buy because the price of gold dropped today,” said Ng Beng Choo. The 70-something retiree said she had arrived and got a ticket at 9.30 am, but was still waiting to be called more than six hours later.
A long-running rally in precious metals kicked into overdrive last month as the Trump administration upended the geopolitical order and renewed its attacks on the US Federal Reserve. Those surges went into reverse on Friday, and the rout continued apace on Monday. At one point gold had dropped by more than a fifth from a record high last week.
But rather than seek to sell, many retail investors appeared to be trying to buy the dip in gold, which fell to near US$4,400 an ounce on Monday.
Singapore, a global wealth hub, is a popular destination for gold purchases because it does not levy taxes on investment-grade bullion or capital gains.
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In central Sydney, a queue of people snaked out into the street from an ABC Bullion outlet near Martin Place.
“I lost a lot of money” on Friday, but “tomorrow’s a new day,” said Alex, a man in his 20s who was lined up outside the Sydney store to buy bullion, declining to give his full name.
Retail buyers may be betting that the main drivers of gold’s ascent – an increasingly unpredictable US President Donald Trump and the debasement trade where investors avoid currencies and sovereign bonds – are still intact. That optimism was shared by Deutsche Bank, which said in a note on Monday it was sticking with its forecast for gold to get to US$6,000 an ounce.
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In Thailand, where gold bars and jewellery are popular, people keep their holdings rather than selling off, Thanapisal Koohapremkit, chief executive officer at Thai brokerage Globlex Securities said.
“It’s still a buying trend in here in Thailand,” added Kuhapremkit. “ They’re holding the old position and then just hold and see.”
At UOB, many customers who had not pre-ordered were disappointed. All products from MKS PAMP, one of the world’s most recognised bullion brands, were sold out, while people who arrived late were out of luck.
“Due to overwhelming response, the buy queue tickets have all been fully issued for the day,” according to notices posted around the UOB headquarters. “Your patience is appreciated.” BLOOMBERG
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