Asia’s financial system liberalization and its population’s growing wealth are two key factors expected to boost demand for gold and push the price of the key commodity over US$2,400 an ounce by 2030, a report published Wednesday claims.
According to the Australia and New Zealand Banking Group (ANZ) predictions, as incomes rise across Asia, particularly in China and India, so will the appetite for gold rings and necklaces.
In its report “East to El Dorado: Asia and the Future of Gold,” ANZ estimates that annual retail and investor demand for the precious metal in the 10 largest economies in Asia could double to 5,000 tonnes within 15 years. The bank dubbed these nations “the A10” – China, India, Indonesia, Japan, South Korea, Malaysia, the Philippines, Singapore, Thailand and Vietnam.
“The bedrock, the anchor of our views of increasing demand for physical gold will come from rising incomes in Asia,” ANZ chief economist Warren Hogan told Bloomberg. “Gold is going to have that investment role and it’s going to become more prominent.”
The precious metal hit $1,1151 in New York during early afternoon trading, staying near four-month lows, as investors remained cautious pending the conclusion of a Federal Reserve meeting that may stoke expectations for a mid-year rise in U.S. interest rates.
Gold has fallen about 3% since the start of the year on expectations for a U.S. rate rise.