China will become the largest market for gold in 2012. And the largest buyer of diamonds in 2015. The gold price took off in New York.
The Chinese appetite for raw materials continues unabated. China will surpass India this year as the first buyer of gold in the world, according to the World Gold Council based in London. And China will surpass the United States as the largest market for diamonds in 2015, ensures the World Diamond Center in Antwerp, which concentrates 80% of global sales of rough gems.
This is a taste for luxury that guides purchases of gold and diamonds to China, which had over a million millionaires in 2010, while the middle class continues to grow. Consumption of diamonds for the Chinese market increases 25% per year on average to 5 billion dollars per year. At this rate, Americans, world champions for the purchase of precious stones, will be quickly outdated. The Anglo-African company De Beers, which sells rough diamonds, saw sales increase by 27% last year, especially to China, India and the United States.
Purchases of physical gold for the Chinese market are also up sharply. They rose 20% last year to 769.8 tons but actually fell by 7% to 933.4 tonnes in India. According to the World Gold Council, the buying of gold by China will surpass those of India in the first half of 2012.
Central bank buying up sharply
Chinese buy gold to offer jewelery, but also to secure the investment, while inflation reached 4% and the government restricted property purchases to counter speculation.
Gold purchases by investors jumped 38% last year, reaching 258.9 tons of gold. Those for jewelery have increased 13% to 510 tonnes of gold.
The central bank buying are also up sharply. They totaled 439.7 tons last year, the highest in five years.
This enthusiasm for physical gold maintains speculation. Especially since the billionaire Paul Paulson, the hedge fund manager of the same name, said that gold would be the best way to protect against inflation. Friday afternoon, an ounce of gold was trading at 1733.18 dollar in New York, up 4.9% on the day, and 11% since the beginning of the year. The previous price peak was 1,921.15 dollars per ounce, during the crisis of the euro.