London: The latest research report by HSBC predicts that gold demand will rebound sharply in 2015 and may reach more than 4100 tonnes.
According to HSBC, there will be two reasons for that: the back of buoyed physical buying in the Asian region, and increased flow of money into bullion-based Exchange Traded Products (ETPs).
Gold prices posted annual drop in 2014 as gold-backed ETPs contracted in the event of rising US dollar and equities. The economic slowdown in China and the ongoing gold import restrictions in India resulted in huge drop in purchases by the world’s top gold consuming nations. The demand for gold jewelry, coin and bars tumbled because of that.
HSBC expects moderate recovery this year based on anticipated demand hike from China and India. The gold prices are likely to average at $1,234 per ounce in 2015, almost three percent down when compared with the average gold price of $1,265.93 in 2014.
Central banks are likely to accumulate more gold this year, thereby providing more support to gold prices. The total purchases this year is anticipated to be around 400 tons, increasing 30 percent from the levels of 2014.