High gold prices hit global jewellery demand
Tuesday, 22 December 2009
DUBAI, Dec 21 (Commodity Online): The outlook for gold investment remains positive and will continue to be underpinned by inflation, economic uncertainty and investors' search for diversification, Rozanna Wozniak, Investment Research Manager at the World Gold Council stated in a webinar on Gold Demand Trends.
Wozniak presented an analysis of Q3 2009 gold demand supply dynamics and trends to investors and traders via a webinar on arabianbusiness.com jointly hosted with Dubai Gold Securities.
"The recent positive steps by India and Sri Lanka to acquire gold suggest that central banks are increasingly looking at gold for its diversification properties. While the outlook for gold investment is healthy in western economies, trends in the non-western markets are likely to mirror the jewellery market," Wozniak said.
Wozniak stated that Q4 2009 is expected to be a mixed quarter. While the gold price has repeatedly tested new highs over the last few months and key jewellery markets are looking for opportunities to buy on dips, it is still too early to see where the new levels of key support will emerge now that the gold price has moved into a new trading range, she said.
Analyzing gold's Q3 2009 performance, Wozniak said that it marked the second consecutive quarter-on-quarter improvement for both jewellery and industrial demand - in the case of industrial demand, it is a clear that the turning point for demand has been reached. However, given the recent rise in the gold price, the outlook for jewellery demand remains uncertain.
"Total identifiable investment, which covers Exchange Traded Funds as well as the more traditional coins and small bars, rose 1 per cent from the previous quarter to 227 tonnes, but declined as compared with the exceptionally high levels seen in Q3 2008. However, relative to a more 'typical third quarter', based on a 5-year average, the rise was a significant 73 per cent, indicating that the absolute levels of investment remain high," Wozniak added.
Grant Collins, Senior Managing Director, Dubai Commodity Asset Management, said, "Gold investments are gaining favor in markets where exposure to the metal was limited until now.
Wozniak presented an analysis of Q3 2009 gold demand supply dynamics and trends to investors and traders via a webinar on arabianbusiness.com jointly hosted with Dubai Gold Securities.
"The recent positive steps by India and Sri Lanka to acquire gold suggest that central banks are increasingly looking at gold for its diversification properties. While the outlook for gold investment is healthy in western economies, trends in the non-western markets are likely to mirror the jewellery market," Wozniak said.
Wozniak stated that Q4 2009 is expected to be a mixed quarter. While the gold price has repeatedly tested new highs over the last few months and key jewellery markets are looking for opportunities to buy on dips, it is still too early to see where the new levels of key support will emerge now that the gold price has moved into a new trading range, she said.
Analyzing gold's Q3 2009 performance, Wozniak said that it marked the second consecutive quarter-on-quarter improvement for both jewellery and industrial demand - in the case of industrial demand, it is a clear that the turning point for demand has been reached. However, given the recent rise in the gold price, the outlook for jewellery demand remains uncertain.
"Total identifiable investment, which covers Exchange Traded Funds as well as the more traditional coins and small bars, rose 1 per cent from the previous quarter to 227 tonnes, but declined as compared with the exceptionally high levels seen in Q3 2008. However, relative to a more 'typical third quarter', based on a 5-year average, the rise was a significant 73 per cent, indicating that the absolute levels of investment remain high," Wozniak added.
Grant Collins, Senior Managing Director, Dubai Commodity Asset Management, said, "Gold investments are gaining favor in markets where exposure to the metal was limited until now.