Post by jeffolie on May 27, 2008 15:11:03 GMT -6
Vietnam's retail investment in gold in the first quarter this year amounted to 31.5 tons, making the country the biggest gold consumer in the world, the World Gold Council says in its most updated quarterly survey Gold Demand Trends.
Using figures compile by independent research house GFMS Ltd., the council says the consumption of 31.5 tons in the first quarter shows a steep increase of 110% year-on-year and accounting for 43% of the world's net retail investment demand of 72.2 tons in the period.
Vietnam's arrival into pole position in the retail investment sector ousts India from the top slot with 31 tons, a decline by half from the first quarter in 2007 as Indian purchasers withdrew from the market and waited for lower and more stable prices.
Furthermore, gold investments have been increasingly marketed by Vietnamese banks. High interest rates enable local banks to offer an interest rate on gold deposits since they can profitably sell the gold for dong, lend the dong out at high interest rates and hedge their gold position by entering into a forward buying agreement with an international bank.
Many Vietnamese prefer to hold gold rather than dong and the fact that this gold can earn interest from commercial banks makes it still more appealing as for investment option, says the report.
The world's total gold demand in the first quarter fell 16% from a year earlier to 701.3 tons. Of which, jewellery demand was 445.4 tons, down 21%, industrial and dental demand fell 5% to 110.3 tons, while investment in ETFs was double to 72.9 tons and net retail investment dropped 35% to 72.2 tons.
english.vietnamnet.vn/biz/2008/05/785220/
Vietnam biggest gold consumer in the world
Using figures compile by independent research house GFMS Ltd., the council says the consumption of 31.5 tons in the first quarter shows a steep increase of 110% year-on-year and accounting for 43% of the world's net retail investment demand of 72.2 tons in the period.
Vietnam's arrival into pole position in the retail investment sector ousts India from the top slot with 31 tons, a decline by half from the first quarter in 2007 as Indian purchasers withdrew from the market and waited for lower and more stable prices.
Furthermore, gold investments have been increasingly marketed by Vietnamese banks. High interest rates enable local banks to offer an interest rate on gold deposits since they can profitably sell the gold for dong, lend the dong out at high interest rates and hedge their gold position by entering into a forward buying agreement with an international bank.
Many Vietnamese prefer to hold gold rather than dong and the fact that this gold can earn interest from commercial banks makes it still more appealing as for investment option, says the report.
The world's total gold demand in the first quarter fell 16% from a year earlier to 701.3 tons. Of which, jewellery demand was 445.4 tons, down 21%, industrial and dental demand fell 5% to 110.3 tons, while investment in ETFs was double to 72.9 tons and net retail investment dropped 35% to 72.2 tons.
english.vietnamnet.vn/biz/2008/05/785220/
Vietnam biggest gold consumer in the world