Demand for gold continues unabated

Demand for gold continues unabated The world’s demand for gold will continue to pressure gold’s price in the years ahead according to the World Gold Council. An official source is quoted as saying, “No devaluation of gold will occur since there is an estimated steady rise in demand for gold every year despite the massive gold sales by the central banks.” Asian countries that have large balance of trade surpluses, especially China, have been buying gold on the physical market. China’s gold market, as a key gold consumption center, was ranked third in world gold demand in 1999, consuming about 205 tons, behind India and the United States. China has adjusted gold prices six times to conform with international pricing in its heavily regulated gold market. China deregulated the domestic silver market in January 2000, and is following up with gold market reform. This will unleash significant demand in a fixed supply market. Major gold producers such as American Barrick and Anglo-American, have sold more gold than they can produce, in forward Arrow and money staircasecontracts, for 4 years into the future.

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