Global gold demand will rise to four-year high in 2019: Metals Focus

LONDON (Reuters) – International demand for gold in 2019 will rise to the very best in 4 years as increased consumption by jewelers offsets a fall in purchases by central banks, an trade report mentioned on Monday.

The world will devour 4,370 tonnes of gold this yr, essentially the most since 2015 and up barely from 4,364 tonnes in 2018, consultancy Metals Focus mentioned.

Its Gold Focus 2019 report additionally predicted gold costs would common $1,310 an oz this yr, up from $1,268 in 2018 and the very best since 2013.

Gold at present trades round $1,300 an oz.

Gold consumption for jewellery will rise Three % this yr to 2,351 tonnes, pushed by will increase of seven % in India and three % in China – the 2 largest markets – which can counter decrease demand within the Center East, Metals Focus mentioned.

Purchases by the official sector, which surged nearly 75 % in 2018 as central banks added gold to diversify their reserves, will slip 9 % this yr to 600 tonnes, the report predicted.

Bodily funding demand will stay largely unchanged from 2018 at 1,082 tonnes.

(Graphic: Gold demand 2010-2019 – tmsnrt.rs/2UZW7ws)

Metals Focus mentioned gold provide would rise by 1 % to 4,707 tonnes because of increased mine manufacturing and recycling and a few producer hedging.

Serving to gold costs to rise can be the top of rate of interest rises by the U.S. Federal Reserve, together with political and financial uncertainty world wide, Metals Focus mentioned, however it added {that a} sturdy greenback would restrict good points.

Gold is historically seen as a secure place to speculate during times of uncertainty.

Larger rates of interest harm gold as a result of they make bullion, which pays no yield, much less enticing to traders, whereas a stronger greenback can depress demand by making gold costlier for patrons with different currencies.