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Gold demand surges from India to Hong Kong despite price rally linked to Israel-Gaza war
- Ahead of the peak festival and wedding season, prices have soared due to the Israel-Gaza war, near an all-time high, but many are still buying gold
- While most of the demand is for jewellery, a growing number of investors are getting in on the precious metal action, analysts say
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Asia’s legendary appetite for gold is intact in the run-up to peak festival and wedding season, despite soaring prices due to the Israel-Gaza war.
Long considered a store of value, gold prices hit a five-month high on October 27 of above US$2,000 an ounce following the conflict in the Middle East, close to an all-time high. Prices have since dipped to US$1,950 as the safe haven rally has weakened.
“Buying sentiment is high as prices have come down a little. People are not sure when prices may rise again because of the war,” said Bachhraj Bamalwa, owner of the Kolkata-based Nemichand Bamalwa and Sons, a large gold and diamond retailer.
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“Many people have weddings between November and January. For them, buying gold is compulsory,” he added. Gold is given to brides as a form of lifetime savings, as well as considered as a token of good fortune.
The Indian festival of Diwali, being celebrated this weekend, is also spurring purchases because it is considered auspicious. High prices are, however, prompting many consumers to settle for smaller quantities, Bamalwa said.
01:31
Chinese consumers sell off old jewellery amid record high gold prices
Chinese consumers sell off old jewellery amid record high gold prices
Large jewellers have already stocked up in the run-up to the festival and are waiting to see whether the Israel-Gaza war escalates in the Middle East, traders said.
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