China Demand to Drive Gold Higher
(Live Trading News) Bullion for immediate delivery rose 0.3 percent to $1,392.07 an ounce at 5:36 p.m. in Shanghai after yesterday touching $1,397.50, the highest price since Nov. 12. The metal reached a record $1,424.60 an ounce on Nov. 9 and is set for a 10th annual gain.

China’s investment gold demand may reach 150 tons this year, up from 105 tons last year, the World Gold Council’s Cheng said. That compares with 3 to 4 tons 10 years ago, Cheng said.

“The investment demand we estimate already reached 120 tons in the first three quarters, and it usually spikes in the fourth,” Cheng said. Global investment demand for gold of 1,901 tons last year exceeded jewelry consumption of 1,759 tons for the first time in three decades, according to London-based researcher GFMS Ltd.

China’s gold market may double in the next decade as retail investment and jewelry demand gain, the World Gold Council said Nov. 3. Consumption may climb to 800 tons to 900 tons in the next ten years, said Wang Lixin, the council’s Greater China general manager. China’s jewelry and investment gold demand was 428 tons in 2009, according to the council.