Reduced appetite from central banks to bring gold demand down in 2023 - Metals Focus
Demand for gold will drop 9% to 4 375 metric tons this year with central banks' appetite falling from last year's all-time high, consultancy Metals Focus said, adding that gold prices would be under pressure in the second half of 2023.
The net official sector purchases jumped 141% to a record high of 1 083 metric tons in 2022 amid de-dollarisation activity, inflated by western sanctions on Russia after its invasion of Ukraine.
These purchases are due to fall but remain at historically strong 600 metric tons in 2023, Metals Focus said in its annual Gold Focus report on Wednesday.
Supply of gold, according to the consultancy, will rise by 2% to 4,881 metric tons this year with higher mine production, recycling and return of hedging by miners.
Metals Focus predicted the gold price <XAU=> would average a new all-time high of $1 890 per troy ounce in 2023, up 5% from $1 800 last year. On Tuesday, the precious metal was trading at around $1 962 an ounce.
The rise of average 2023 price will be caused by the year-to-date rally due to expectations the US Federal Reserve's tightening cycle was almost over and that rate cuts were likely.
The consultancy said expectations of U.S. rate cuts before 2023 ends are too aggressive and that the Fed still has room to keep rates high for longer - meaning pressure on gold in the second half of 2023.
Downside will be limited by strong demand for gold from the official sector as well as retail and institutional investors.
Comments
The
content
you are trying to access is only available to subscribers.
If you are already a subscriber, you can Login Here.
If you are not a subscriber, you can subscribe now, by selecting one of the below options.
For more information or assistance, please contact us at subscriptions@creamermedia.co.za.
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation