China Gold ETF Asset Management Reaches An All-Time High Of 17 Billion Yuan

(November 5, 2019 - Interface News)

The content below was translated by Tencent automatically for reference.

SMM news: boosted by strong gold ETF inflows, as well as the growth of gold reserves in central banks around the world, global gold demand rose slightly in the third quarter.

On November 5, the World Gold Council held a press conference in Shanghai on the report on Gold demand Trends (hereinafter referred to as the "report"). Global gold ETF positions hit an all-time high of 2855.3 tonnes in the third quarter, while global gold demand rose slightly to 1107.9 tonnes, up 3 per cent from a year earlier, according to the report.

Gold ETF, is an open-end fund based on gold. In the second quarter of this year, the global gold ETF position was 2548 tons, the highest in nearly six years.

Looser monetary policy, gold risk aversion and the potential energy of gold prices themselves have been the main drivers of gold ETF inflows, the report said.

Wang Lixin, managing director of the World Gold Council in China, said at the press conference that against the backdrop of strong global gold ETF growth this quarter, the asset management of China Gold ETF has increased to 17 billion yuan, an all-time high.

In addition to the increase in gold ETF holdings, the growth of gold reserves in central banks around the world has also led to an increase in demand for gold. Between the start of the year and the end of September, central banks bought a total of 547.5 tonnes of gold, up 12 per cent from a year earlier.

Over the same period, trends such as the decline in global economic growth and the surge in gold prices have dampened demand for gold ornaments by many consumers.

Global gold demand fell to 460.9 tonnes in the third quarter, down 16 per cent from a year earlier. Investment demand for gold bars and coins also halved to 150.3 tons.

Gold rose 5 per cent in the third quarter and was firmly near support of $1500 an ounce, according to the report.

Demand for gold in China also fell in the third quarter.

Chinese gold jewellery demand has fallen for four consecutive quarters compared with the same period last year, according to the report. In the third quarter, demand for gold ornaments in China was 156.3 tons, down 12 per cent from a year earlier. Demand for gold bars and coins in China fell to 42.8 tons, the lowest level in three years.

On the supply side, global gold supply reached 1222.3 tons in the third quarter, the highest level since 2016.

Global gold production in the third quarter was 877.8 tons, roughly the same as the same period last year, the report said. The growth in gold supply is mainly driven by the supply of recycled gold.

The continued rise in gold prices has driven consumers to sell gold, and global supply of recycled gold rose 10 per cent in the third quarter from a year earlier to 353.7 tonnes, the highest level since the first quarter of 2016, Mr Wang said.

Horace (Alistair Hewitt), director of market information consulting at the World Gold Council, believes that factors such as loose monetary policy and geopolitical uncertainty will continue to affect market confidence. Gold ETF positions and central bank demand for gold are expected to increase, and consumer demand for gold ornaments will continue until the end of the year.

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