Regarding Chinese gold demand, which we wrote about yesterday, it is open to debate and our old friend, Brien Lundin of the Jefferson Companies in New Orleans, wrote to share his insights. We’ve chosen to share them further with our readers, with his approval. Brien wrote:
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Hi, Dennis:
In your letter this morning, you noted that Chinese gold demand was recently reported to be down about 50 percent year over year. This is erroneous information from the World Gold Council, as I’ve been noting in Gold Newsletter — that there’s a lot of misinformation on this topic. The mainstream financial media keeps parroting numbers from the World Gold Council and other sources, which typically rely on import statistics from Hong Kong.
However, China has recently opened up new ports of entry for gold, a move that has correspondingly reduced the import numbers from Hong Kong.
"Much more relevant are gold delivery statistics from the Shanghai Gold Exchange, which directly indicate wholesale gold demand in China. Koos Jansen is today’s leading reporter of Chinese gold demand dynamics, and he relies on the Shanghai Gold Exchange numbers for his analyses. Using the SGE reports, Jansen notes that Chinese gold demand year to date is down about 17 percent from last year’s torrid pace.
This post was published at GATA
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