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  • India & Turkiye lead global gold buying as China holds back

    Mon July 08 2024


    China's central bank did not purchase any gold in June, marking the second consecutive month of no gold purchases. Last month marked the end of an 18-month buying streak that pushed Gold prices to record highs. Prices peaked at $2400 an ounce in May but suffered a decline as China awaits price correction to around $2200 per ounce.

    Despite the dip, Gold prices were boosted by emerging economies like India & Turkiye. India boosted its gold reserves by nine tonnes in June, bringing the total reserves to 841 tonnes. This marks the largest monthly increase in two years. India also leads among Asian G20 countries in the highest value of Gold as a percentage of total reserves. 

    China was the largest institutional buyer of Gold in 2023. This aggressive buying trend, led by China & India, was to counter the geopolitical uncertainties roiling currency and stock markets. This led to a global surge in Gold prices. However, in 2024, economic slowdown and property woes have forced China to pump stimulus into the market. This has raised costs for the government, which is now waiting for Gold prices to drop before resuming buying.

    Will Gold prices dip?

    Gold prices have been on an upward trend, more so after Russia's war in Ukraine spooked investors to pivot to safe-haven assets. While China has been a major factor driving the Gold uptick, the prices are only expected to jump as geopolitical uncertainties continue. US Federal Reserve's rate cut bets in November offsets the lack of buying momentum from China, with India leading the Gold demand in 2024.

    The World Gold Council notes that Central Banks and Emerging markets are crucial to sustaining Gold demand as supply challenges loom due to mining bottlenecks and environmental permit difficulties.