Premiums For Gold Bars In Asia Highest Since 2004

It's actually "at least 2004," since Reuters has only been tabulating data since that year. Premiums for 1 kg gold bars in Hong Kong are now at $4/oz, up from $3 last week.

Physical dealers have seen a pick up in demand in recent weeks ahead of the Lunar New Year later this week and the wedding season in India in February, although any increase in cash gold prices also triggered selling from speculators.

"There's a lot of interest from India, but it's just that we can't meet their demand. Everybody is snatching the available stocks," said a dealer in Singapore. "We are seeing some light selling from Thailand, but there's also buying at lower levels."

Premiums for gold bars in Singapore remained firm at $3 an ounce, also their highest since at least 2004, partly driven by demand from top consumer India ahead of the wedding season, when parents give gold jewellery to their daughters....

"My clients offered to buy gold bars at $5 premium, but I have no gold. Nowadays, gold is booked and sold even before they leave the refinery," said another dealer in Singapore.

"There's some selling back in the gold market, but the premiums are still high. I do see light selling by the Thais too, but one consumer just called to sell me back the gold in transit."

Although Chinese markets are closed for the New Year Festival, dealers still expect some stocking up in part of Asia where the markets aren't closed. The Indian wedding season is coming up.


This item makes for a notable contrast from shrinking investment demand. So far this year, investment has held the balance over physical buying - but the latter has provided a needed cushion to gold's falling price. Had the physical buying shrunk too, gold would have suffered an all-out correction.