India's ＂buy explosion＂ gold： government, central bank, and farmers have shot together. This year's total demand may reach 850 tons!Bank of America： The price of gold will far exceed 3,000 US dollars

Image source: Visual India -VCG41143457749

On the evening of October 21 (Monday), Beijing time, the price of gold in the US dollar was once reached $ 2740.52 / ounce, a record high.According to the Dow Jones market data, the price of the most active gold contract has reached a record high of 35 times since the beginning of the year.

In this "soaring" gold market, there is a big buyer who has been "ignored" by the market: India.After a sharp decline in gold and silver import tariffs at the end of July this year, India's demand for gold soared. The import volume in August increased to 140 tons, which was three times the import volume in July.In September, although India's gold imports declined from the previous month, Bloomberg reported that with the advent of the "Lantern Festival" and the wedding season, the country's demand for gold may continue in the next few months.

Analyst Zhong Yixin, an analyst of Mai Gao Securities Research and Development Department, pointed out in an interview with the reporter of the Daily Economic News that since August, the surge in gold demand in the Indian market and subsequent expectations are not the leading factor in renewing the recent historical high, but one of the factorsEssence

She added that the main reason for the rise of gold in this round of gold is the loose liquidity of the global market, which is superimposed with risk aversion (heating).She believes that as traders continue to pay attention to the tension of the Middle East and the approaching US elections, the surge in demand for risk aversion has supported gold prices.Lucknow Wealth Management

Gold buyer "ignored" by the market: India

At the end of July, India reduced the import tariffs of gold and silver from 15% to 6%. At the same time, the import tariffs on platinum and gold reducing the import tariffs from 14.35% to 5.35%.Some analysts point out that as the Indian authorities reduce the import tariffs on gold and silver, India's gold demand is expected to remain strong in the next few months.

As the world's second largest gold consumer, India relies heavily on imports to meet domestic demand.According to statistics from the World Gold Association (hereinafter referred to as WGC), from 2016 to 2020, imported gold accounted for 86%of Indian gold supply, 13%of recycling gold, and only 1%of mining gold.According to WGC data, before the gold and silver import tariffs were reduced, Indian gold jewelry purchases have been declining, and the demand in the first half of 2024 is even a new low since 2020.

After the import tariff was reduced, India's gold imports increased to 140 tons in August, which was three times the import volume in July.According to the amount, India's total value of gold imports in August was US $ 10.06 billion, a record high in a single month, accounting for about one -sixth of the country's total trade imports (US $ 64.36 billion) in August.

However, India ’s gold imports in September fell sharply to $ 4.39 billion month -on -month, but Bloomberg reported that India’ s high demand for gold may continue because this year ’s abundant monsoon has brought hope for the harvest of crops. This may increase India in India.Farmers' disposable income.

As a country with the largest population in the world, India has a deep golden cultural heritage. Gold is regarded as a means of value storage, and it is also a symbol of wealth and status. At the same time, it is also a basic component of weddings or other celebrations.According to WGC data, about 60% of India's gold demand comes from rural areas.The deep love of gold in India's rural population is inseparable from the actual consideration of the portability and security of jewelry as investment.

As India enters large holiday celebrations and wedding season, the purchase of gold and jewelry will be further accelerated in the next few weeks.It is reported that the celebration of Hinduism will reach a climax from October 29th to November 3rd, and December and January will be the densely wedding season in India in December and January.Ahmedabad Investment

According to data released by the Central Bank of India, as of October 11, 2024, India's foreign exchange reserves were US $ 690.4387 billion, approaching a record high, providing support for India's imported gold.In the first eight months of this year, the Central Bank of India purchased a total of 50 tons of gold, far exceeding the net purchase volume in 2022 and 2023.As of September 19, the gold reserves of the Bank of India reached 853.6 tons of record, accounting for 9%of its total foreign exchange reserves, which was higher than 7.5%a year ago.

In August this year, India's gold import surge in picture source: Bloomberg News Agency

The WGC India CEO Sachin Jain said: "India's support policies and measures for gold have a positive impact on the domestic gold market." This may increase the gold demand in India in the second half of 2024,The demand may be between 750 tons and 850 tons.New Delhi Wealth Management

"Daily Economic News" reporter also noticed that the Indian market's demand for gold is not just physical goldGuoabong Wealth Management. The data of WGC shows that India's gold ETF has recorded net inflow of funds for 4 consecutive months.New high.

In an interview with the reporter of the Mai Gao Securities Research and Development Department, Zhong Yixin pointed out in an interview with the reporter of the Daily Economic News that the reason for the rise in gold prices must be multiple aspects."(Although India has increased its demand for gold since August, and the approaching of the important festivals in India) cannot be said to be the leading factor of the continuous historical high in this round of gold, but it is also one of the factor.The impact may not be so great, and more financial attributes are relatively large. "

Multi -factor resonance promotes gold. Bank of America analysts say that gold will "far exceed 3,000 US dollars / ounce"

In Zhong Yixin's view, the main reason for this round of gold to renew its historical high is the looseness of liquidity, superimposing risk aversion (heating).

Bloomberg reports that gold is one of the most powerful commodities in 2024 and has risen more than 30%since this year.On the evening of October 21st (Monday), Beijing time, the price of dollars in US dollar pricing once touched $ 2740.52 / ounce, a record high, far higher than the "front high" of US $ 2,000 / ounce in 2020 and 1900 US dollars per ounce in 2011.As of press time, the price has fallen slightly, but it is still above 2730 US dollars per ounce.

Since July 2024, the gold trend of the US dollar pricing picture Source: Futu Niu Niu Niu Niu Niu

Regarding the continuous rise of gold prices, analysts said that the dual drive of currency attributes and risk aversion attributes: On the one hand, the Federal Reserve's next easing is continuously strengthened. In addition, the US election is approaching.Layout; on the other hand, the tension of geopolitical politics has pushed up the market's hedging demand.

Dapeng Dapeng, Director of Everbright Futures, pointed out in an interview with the reporter of "Daily Economic News" that the US consumption and employment market shows that the US "soft landing" is expected to maintain, which further strengthens the probability of the Federal Reserve ’s interest rate reduction at 25 basis points in November., But this does not mean increasing easing; at the same time, the market's attention to the US elections is increasing, which has also affected market transactions. At present, the market has a layout of Trump's transactions.

He further supplemented: "Investors are worried that the tariff policy brings the rapid rise of inflation, which has also promoted the rise of gold prices.The market was disturbed, and geopolitical factors have also given recent strong support for gold prices.In the later trend of gold, keep cautious in optimism. "

The Bank of America chief strategist Michael Hartnett pointed out in a report last week that the Fed is determined to promote the decline in actual interest rates in the next few quarters. Investors need the threat of hedging inflation and the depreciation of the dollar -Bitcoin price is approaching a historical high of $ 75,000 in history highPoints are also proof.Hartnett thus concluded that "gold will far exceed $ 3,000 / ounce".

Australian federal bank analyst Vivek Dhar also echoed Hartnett's point of view in a report on October 21.Dhar believes that the price of gold futures in the fourth quarter of 2025 may rise to an average of $ 3,000 / ounce.He added that the Fed's interest rate cut cycle may lead to the US dollar softened.For many buyers, the depreciation of the US dollar makes gold cheaper because gold is denominated in the US dollar.

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