Last Friday gold went to on a solid downward ride. The price of the yellow metal fell by $26 to the mere $1,598.23 per ounce.
This price continued its dip at the beginning of the week. There is no need to sell gold from your portfolio in term of panic.
Before doing something harsh consider the just released data from industry trade group World Gold Council.
China accounted for approximately 25% of consumer gold demand in 2012. That belittled the gap between top gold buyer India and the second in the face of China. According the London-based World Gold Council the yellow metal consumption of both countries is expected to growth by 11% in this year.
It is certain that even World Gold Council can have deviations in its forecast. Though, central banks of Portugal, Russia and Brazil continued buying more gold in 2012 despite price fluctuations. That was to diversify their currency holdings further. World Gold Council reported that in 2012 worldwide central banks bought more gold than they have in the last 48 years period.
Last year central banks added 534.6 tons to their reserves. That is 17% more the numbers in 2011. This positive trend compensates the first annual drop in total demand in three years. In 2012 jewelry demand fell 3.2% while investment demand fell by 9.8%.
The problem is that in the short term declining gold prices have caused a lot of worries.
Since the beginning of 2013 the yellow metal went on a downward ride.
Today Gold for immediate delivery gained as much as 0.3 percent to $1,615.35 an ounce and traded at $1,612.62 at 4 p.m. in Singapore. Prices dropped to $1,598.23 on Feb. 15, the lowest since August.
Tuesday the yellow metal inched higher for the first time in a week. The rise came on speculation prices near a six-month low will boost demand amid concern that the US economic recovery may slow down.
The longer term projections are definitely positive but short term volatility instills fear on the gold market.
