Your monthly update on gold in China covering gold prices, wholesale demand, central bank buying and more.
The divergence between the RMB and USD gold prices widened. The weakening US dollar and lowering yields helped pushed the LBMA Gold Price AM in USD 7.4% higher in November, the best month since July 2020.
The domestic gold price diverged from the international gold price: the MCX Gold Spot price rose marginally by 0.2% compared to a 2% decline in the LBMA Gold Price AM in USD
Gold’s price divergence continued: the Shanghai Gold Price Benchmark PM (SHAUPM) in RMB rose by 1%, while the LBMA Gold Price AM in USD saw a 2% fall in October.
Due to fewer working days in the month and manufacturers’ active replenishing ahead of the Chinese New Year (CNY) holiday, gold withdrawals from the Shanghai Gold Exchange (SGE) in February fell m-o-m.
The domestic gold price increased by 4.1% in February m-o-m and 8.4% higher than the end of 2019. The rising gold price and higher volatility in the market lured investors towards gold ETFs.
Gold was higher last week (XAU +1.1%, LBMA +1.2%), as markets were volatile, and the US 2/10 curve turned negative, which has historically often preceded a recession.
