During Tuesday’s US session, gold (XAU/USD) staged a recovery from earlier losses, hovering in the $2,350s range. This resurgence comes as the US dollar weakens and market sentiment turns pessimistic, bolstering the appeal of safe-haven assets like gold.
The precious metal’s turnaround follows apprehensions regarding waning demand in China, its largest market. Concerns were fueled by recent data indicating a significant decline in gold imports to China via Hong Kong.
Data released by the Hong Kong Census and Statistics Department on Monday revealed a stark 38% drop in gold imports to China in April compared to the previous month. Net imports into the world’s leading gold consumer amounted to 34.6 metric tons in April, a substantial decrease from the 55.8 tonnes recorded in March.
Hong Kong International Airport serves as a primary hub for gold storage before its final transport into mainland China. Most of the commodity is transported by air, necessitating storage at the airport before crossing the border.
This downturn contrasts with the robust consumption witnessed in China during the first quarter, as reported by the China Gold Association (CGA). Data from CGA highlighted a 5.94% year-on-year increase in gold consumption in the first three months of the year, with China-based buyers consuming 308.91 metric tons of the precious metal, as reported by the China Daily.
