Gold is marooned between US rates and India demand
History and logic suggest that when the United States starts a monetary tightening cycle, gold will underperform, since as a non-yielding asset it loses out to instruments that will enjoy higher yields from the rising rates.
The main boost to gold prices in 2017 may well come from India, formerly the world’s top consumer of the precious metal.
Indian gold demand was pummelled in 2016, falling 21 percent to 675.5 tonnes from 857.2 tonnes the prior year, the biggest yearly decline in volume terms recorded by the World Gold Council.
One of the main factors driving the slump was the government’s ongoing efforts to attack the informal econo
In an economy where most transactions are still cash, the impact was to crimp retail gold demand as liquidity dried up.
But there are positive signs that India is recovering, with imports jumping to 50 tonnes in February, up more than 82 percent from the same month in 2016, according to data provided by ..