BackGold prices may rise to 6-year high this year amid higher demand: Report
Gold consumption for jewellery will rise 3% this year in India: Metals FocusAlso helping gold prices to rise would be the end of interest rate rises by the US Federal Reserve
PremiumLondon: Global demand for gold in 2019 will rise to the highest in four years as higher consumption by jewellers offsets a fall in purchases by central banks, an industry report said on Monday. The world will consume 4,370 tonnes of gold this year, the most since 2015 and up slightly from 4,364 tonnes in 2018, consultancy Metals Focus said.
Its Gold Focus 2019 report also predicted gold prices would average $1,310 an ounce this year, up from $1,268 in 2018 and the highest since 2013.
Gold currently trades around $1,300 an ounce.
Gold consumption for jewellery will rise 3% this year to 2,351 tonnes, driven by increases of 7% in India and 3% in China - the two largest markets - which will counter lower demand in the Middle East, Metals Focus said.
Purchases by the official sector, which surged almost 75% in 2018 as central banks added gold to diversify their reserves, will slip 9% this year to 600 tonnes, the report predicted.
Physical investment demand will remain largely unchanged from 2018 at 1,082 tonnes.
Metals Focus said gold supply would rise by 1% to 4,707 tonnes thanks to higher mine production and recycling and some producer hedging.
Helping gold prices to rise would be the end of interest rate rises by the US Federal Reserve, along with political and economic uncertainty around the world, Metals Focus said, but it added that a strong dollar would limit gains.
Gold is traditionally seen as a safe place to invest during periods of uncertainty.
Higher interest rates hurt gold because they make bullion, which pays no yield, less attractive to investors, while a stronger dollar can depress demand by making gold more expensive for buyers with other currencies.
This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.
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