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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: hunchback who wrote (36864)	7/9/1999 5:50:00 AM
From: Alex	Read Replies (1) \| Respond to of 116782

Asian Gold-Demand returns as economies recover HONG KONG, July 9 - Asia has regained its appetite for gold as economies recover and currencies recoup, making gold priced in U.S. dollars more affordable, traders said on Friday. While gold demand is not strong everywhere, a resumption in buying after Asia's financial crisis is welcome as the battered metal has fallen to 20-year lows on central bank gold sales. Physical demand in Asia has been coming back for the past two to three months, Dick Gazmararian, executive vice president of Republic National Bank, said. "Demand in Malaysia, Singapore and Indonesia has been running at strong levels," he said. Gold fabricators are operating at full steam. Hong Kong and China, however, were slow because of a weak economy, but that should change, Gazmararian said. "As the Asian markets recover, gold will recover with them," he said. Historically Asia has been a source of growth because of vigorous demand for jewellery and the urban population's rising purchasing power. Outside of the cities gold appeals to rural Asians too. From Java's terraced rice paddies to the vast tracts of Mongolia gold is seen as a store of value against political uncertainty and volatile currencies. Spot gold was quoted at US$256.30/80 an ounce at 0430 GMT. ASIAN GOLD DEMAND BY COUNTRY CHINA--Gold demand in the world's most populous nation is about 200 tonnes annually but demand was expected to be slow because of uncertainty about the economy, job security and disinflation. HONG KONG--High unemployment and recession that resulted from the Asian crisis have hurt gold demand. Reforms in China to make the gold price follow the world price have curtailed gold smuggling from Hong Kong into the mainland. SINGAPORE--Demand has strengthened with economic recovery and because neighbouring Indonesia has seen a strong upsurge in demand fuelled by a sharp recovery in the rupiah, making gold's price more attractive. Premiums have risen 20 percent in a week. INDONESIA--While traders report good demand from Indonesia, others say gold has lost its lustre. An official at a pawnshop in Jakarta said more people would pawn their gold because of the falling prices. "For the time being, I haven't seen a rush. But I believe more people will come to my office soon to pawn their gold because of the falling prices and uncertainty in the international market," said the official. JAPAN--Analysts in Japan said that at current prices, investors saw gold as an attractive asset to keep in the longer term, rather than as a means to take profits. Demand was tied not only to weak prices but to the strength of the yen as well. "The timing people are waiting for is when both the spot price and the (dollar/yen) currency level become favourable," said Akio Shibata, general manager at Marubeni Corp's industrial research section. A dollar/yen level below 120 yen and a retail price under 1,000 yen per gram would encourage investor buying, he said. TAIWAN--An acceleration in imports was rather a reaction to low global prices than a genuine increase in domestic demand, dealers said. But dealers did not rule out a chance for relatively big local gold consumption if global prices fall further, which dealers said would trigger strong buying in gold. "If gold prices slip further, it is less likely Taiwan consumers will resist the low-price temptation," said one gold dealer. SOUTH KOREA--The recent drop in global gold prices has failed to boost South Korean demand due to the weakening won against the dollar, but there has been good demand from local jewellery makers for exports, traders in Seoul said. The benchmark daily local gold bullion price, posted by LG Industrial Systems Co Ltd was 10,220 won per gram on Friday, up from 10,180 won on Thursday. yahoo.co.uk