China’s August net gold imports via HK lowest in over 2 years

China’s monthly net gold imports via Hong Kong dropped 76 per cent to their lowest level in more than two years in August, data showed on Thursday (Sep 26), as a record price rally curbed appetite in the world’s top bullion consumer.

China imported a net 6.245 tonnes in August, down from 25.659 tonnes in July, Hong Kong Census and Statistics Department data showed. Imports were at their lowest level since April 2022.

Total gold imports via Hong Kong were down 48 per cent at 16.377 tonnes last month.

China holds the top spot in terms of gold consumption, its purchasing activities can affect overall global gold prices.

China for the first time since January 2021, refrained from gold imports from Switzerland in August, customs data from the world’s biggest bullion refining and transit hub showed.

Additionally, China decided to halt its gold purchases through its central bank in May, making August the fourth straight month without additions to its reserves.

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“Prices have risen too quickly for Chinese investors, reducing their appetite to buy at current levels,” said UBS analyst Giovanni Staunovo, adding that it is likely that China’s gold import quotas might have been already reached, limiting the desire to import.

“Traditional Chinese buyers are absent, be they retail, jewellery, institutional or central bank, the only buyer who is large is speculative interest,” said independent analyst Ross Norman.

Spot gold has risen 29 per cent so far this year, with a rally driven by interest rate cut by the US Federal Reserve and safe-haven demand due to geopolitical uncertainties.

China’s central bank this week unveiled its biggest stimulus since the pandemic to pull the economy out of its deflationary funk earlier in the week.

The Hong Kong data may not provide a complete picture of Chinese purchases, as gold is also imported via Shanghai and Beijing. REUTERS