Dealing Desk: Chinese currency fears fuel the world’s oldest currencyAug 13, 2015·Kelly-Ann Kearsey
The inevitable economic fears following China's decision to devalue its currency have sent some investors gold hunting this week, although interestingly, Dealing Manager Kelly-Ann Kearsey said more of their customers have been jumping on silver's ascendency.
'Silver was definitely the favourite metal of the week in terms of the number of buyers, although gold won the week in terms of the total value of purchased metal. While both have been slipping in recent months, silver has perhaps fallen the most. In April 2011, it was riding high at over $48, in recent weeks its been at its lowest levels in five years, trading at around $15.
'All the metals have made gains this week and we've seen the usual selling out of the UK and Swiss vaults, with buying going into Singapore.
'The latest World Gold Council (WGC) Gold Demand Trends report shows how gold demand had fallen 12% in the second quarter of this year - its lowest level in six years. This was, in part, this was due to China's economic slowdown, but also to India, being the world's two largest consumers of the yellow metal. However, it may predict a tailing off in supply and in recycling, and as we move into what are traditionally the busiest times for Indian gold buying, the WGC are expecting demand to pick up again.'
Meanwhile, says Kelly-Ann, 'The bears are continuing to predict lean times for gold prices until the U.S. Federal Reserve raises interest rates and the spectre of inflation returns. Conversely, concern over the Chinese economy and the impact it will have on worldwide stock markets is likely to still encourage those who want to diversify their portfolio risk into purchasing gold. Additionally, the low prices across the precious metals may also tempt speculators back into the market.'
Week on week price performances
13/08/15 16:00. Gold up 2.4% to $1,115.51, Silver up 5.1% to $15.39, Platinum up 4.4% to $988.25 and Palladium up 3.4% at $619.00. Gold/Silver ratio: 72
NOTES TO EDITOR
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