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How The Year of The Dragon Celebrations Will Increase China’s Gold Demand
by Michael Locklear
August 3, 2012 – Gold demand from China is expected to increase as we see their economy improving and the forthcoming New Year’s celebration as they enter the year of the Dragon.
What has the year of the Dragon got to do with the increased demand for gold in China? Well, as it turns out, a great deal. The Chinese believe that the Dragon is the animal most connected to luck abundance. Parents in China encourage their children to marry under this auspicious sign. It will be a big push for couples to have their babies during this time as well. Both of these events are normally important gift giving occasions and the Chinese are fond of giving gold as gifts for births and weddings. Since there is so much luck attached to marriage and birth during the year of the Dragon, there will be an increase in the number of both events.
All this has gold market predictors very positive. As we approach the Chinese New Year in January 2013, it is estimated that gold imports into that country would double. As India falls behind in its gold imports, China is believed to be on course to pick up the slack.
One of the traditions of the Chinese New Year is to give red envelopes filled with large cash gifts. The next year is expected to bring more families giving gold instead. This increase in gold gifts has China leading in gold purchases and it may surpass India as the world leader in gold consumption.
Recent reports from overseas traders dealing in gold and other precious metals show the Chinese are already making big moves on this new trend towards gold. Both the London and Hong Kong traders are receiving huge new orders for gold recently. This is a pattern that has been building up the last few months. Although gold has had a slow year in some markets, the Asian markets are brisk and the price of this metal in Shanghai is outperforming the Western markets.
China has seen a strong growth in gold gift giving this year and, in fact the popularity of this practice has increased dramatically. The year of the rabbit has seen the widespread giving of gold items with rabbit motifs. Bars up to 100 ounces are intricately engraved with the scenes of various rabbit themes. Gold products with rabbits on them are flying off the shelf in some retail outlets in Chinese cities.
All this has experts all over the world in both the trading centers and the mining industry predicting that China would take the lead position in gold consumption over India this year. Some believe this trend will defiantly continue into 2013 after the New Year season this past. The future is looking golden in China.
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