Chinese gold imports fall to ten-month low in June

Gold has not been able to hold its own above the $1,100 per troy ounce mark despite a weak US dollar and slid for a time yesterday to $1,089. The depreciating US currency meant that the price in euro terms was under even greater pressure and was driven down to €984 per troy ounce. 

According to data from the Census and Statistics Department of the Hong Kong government, China imported a mere 37.1 tons of gold on a net basis in June, notes Commerzbank. That is a good 8% down on the already weak month of June last year, and also the lowest net import volume since August 2014. What is more, imports were only a good half of what they were in May. Imports in the first half year thus total a good 370 tons, which is 17% less than in the equivalent period last year. 

A major part of the weak demand is no doubt attributable to the sharp rise in Chinese equity markets in the first 5½ months of the year, which reduced the attractiveness of gold. According to Commerzbank, the slump in equity markets that began in mid-June and the fall in gold prices themselves will generate increased interest in buying gold in the second half of the year, which should lend support to the gold price. Coin sales in the US also continue to be very robust: according to figures from the U.S. Mint, 157,500 ounces of gold coins have already been sold in July, which is twice as much as in the whole of June.