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Gold demand in China, the second- largest user after India last year, may expand 13 percent to 870 metric tons in 2012, the World Gold Council said, dropping a forecast for consumption to reach as much as 1,000 tons . . . .

It has been an interesting week on the economic stimulus front with what looks like a coordinated effort by the major powers to ignite their respective economies. The European Central Bank (ECB) made the headlines with a widely anticipated cut to its key interest rate. Next up to the plate was The Bank of England (BoE) chipping in with STG50 billion. Then we have The People’s Bank of China who decided to cut its benchmark lending rate by 31 basis points to 6.0 per cent. Now we wait patiently for the next shoe to drop, which belongs to the United States . . . .

The current dislocation between gold equities and bullion has been heavily debated but, is it temporary or indicative of a fundamental change? . . . .

Last week, gold came under some strong selling pressure from traders on Comex as they managed to knock gold prices down by around $60 an ounce. The sell-off began on Wednesday when prices fell below the key support level of $1600 an ounce after, Ben Bernanke, Chairman of the US Fed announced the outcome of the US Federal Open Market Committee meeting . . . .

Many Indian investors are making a beeline for silver, and are refraining from buying gold due to its high price, though gold is expected to give a 20% return in 2012.With gold prices too hot for many in India, silver has regained its sheen. Sales of silver coins are soaring in India, with most consumers buying silver coins which . . . .

Yesterday, June 18, 2012, the FDIC distributed a rule-making notice to member banks, telling them it intends to change collateral rules, among other things. . . . .

China is widely expected to overtake India as the world’s biggest consumer of gold this year with gold purchases rising by 10 per cent, according to the leading Chinese bank ICBC. Why? . . . .

MUMBAI: With gold prices reaching an alltime high of Rs 30,420 per 10 gm on Wednesday, investors are keen on parking their money in platinum, which is trading at Rs 28,500 per 10 gm. Analysts said it was right time to buy platinum because the metal is likely to provide nearly 30% returns by the end of the year. . . . .

Marc Faber, a normally bearish market commentator, believes gold has hit a low. Meanwhile, leading asset allocators are holding around 7.5% on average in the precious metal . . . .

The lack of notable increases in Asian central bank gold holdings is startling given that over the past decade the rise in foreign reserve assets has been growing at unprecedented levels. The Bank for International Settlements (BIS) noted in its June 2012 Quarterly Review that "central bank balance sheets in emerging Asia expanded rapidly over the past decade because of the unprecedented rise in foreign reserve assets." . . . .