Mumbai: The World Gold Council (WGC) on Thursday described as a ‘misconception” that the main causes for the 4.3 per cent fall in gold prices on Monday was due to the possibility of the US Fed Reserve raising interest rates and slowdown in buying of gold by China.
It said whilst the US Fed’s proposed hike could have been factored in gold prices, gold demand in China remains in good health. “Demand may have eased in China since the highs of 2013, but its growth trend is intact,” WGC said.
It said the sharp fall on Monday 20, July 2015, during Asian trading, from a closing price of 1,134.14/oz on Friday, to an intra-day low of $1,086.18/oz, saw a quick rebound to stabilise a little above $1,100/oz.
This fall, it said, “was precipitated by significant trades on the Globex platform on COMEX and the Shanghai Gold Exchange (SGE).”Trading data reveals that 4.7 tonnes was offloaded on the SGE at 2.29 am BST this is an exceptionally large amount in a short space of time. Normally little more than 40 tonnes trades in a day. At around the same time, volumes spiked on COMEX. Both trades were made during periods of low market liquidity.”
