Tuesday, July 9th 12:01 PM IST

Lower prices lures China,emerging market Central Banks to Gold

# gold  # Central banks  # monetary stimulus  # gold prices  

Earlier in the week, the Chinese push to ease the liquidity crunch in China's interbank monetary market is helping allay fears of a sharp slowdown in China's growth. Easier monetary conditions may provide support for platinum and palladium in coming weeks and months.

LONDON (Bullion Street): Lower prices have lured emerging market Central banks to gold and this is evident from the data reported by International Monetary Fund. In April and May, 24 tonnes of gold were bought by central banks, ETF Securities Ltd said in a weekly report. Chinese consumers are also seeing lower prices as a buying opportunity. 

Earlier in the week, the Chinese push to ease the liquidity crunch in China's interbank monetary market is helping allay fears of a sharp slowdown in China's growth. Easier monetary conditions may provide support for platinum and palladium in coming weeks and months.

World Gold Council quarterly data, which will be produced in coming weeks, also include estimates of other official sector buying and should provide a fuller picture. However, the underlying trend of strong net central bank purchases of gold appears to be firmly intact.

Key events to watch this week
Eurogroup expected to reach a deal with the Greek government on the next tranche of bailout funds. Investors will also be poised for news from Portugal and Egypt as they each grapple with establishing new leadership.

 

Courtesy: BigStockPhoto.com

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