Gold goes East as consumers hoard bullion and jewellery
Ownership of the world’s gold shifted further East during the first half of 2013, as Westerners dumped their exchange–traded holdings and, on the other side of the globe, Asian consumers responded to lower prices by adding to their hoards of jewellery and bullion.
This was the picture painted by the latest data from The World Gold Council, the mining industry trade body and research organisation, which reported overall demand for gold 12pc lower in the three months to the end of June than in the comparable period for 2012. Demand for the metal is currently running at 83pc of its five–year average.
The WGC attributed the slump to the massive sale by western investors, mostly in the US, who own gold through exchange–traded funds (ETFs). These vehicles work by linking reserves of gold – secured in bank vaults in or around Western capitals – to shares freely traded on the world’s major exchanges.