Asian countries are not only buying up gold, they also have a huge appetite for silver.
Chinese imports of the white metal are on a record-breaking pace this year, driven partly by strong demand for jewelry and industrial applications such as solar panels.
According to the Wall Street Journal, based on the current trend, Chinese silver imports will top 3,000 tons in 2016, making it the best year since 2011:
China—which accounts for around one-fifth of global silver demand—imported 282 tons of the precious metal in October, up 36% year-over-year. Its total imports of 2,678 tons in the first 10 months of the year are already around the same level as achieved in the whole of 2014.”
The Chinese aren’t alone in their silver binge. Silver demand in India has remained robust after a record-breaking 2014. India accounts for another 10% of global silver demand.
The number of people buying silver in China and India reflect a broader devotion to precious metals in general. China also leads the world in gold consumption, with India coming in a close second.
The Chinese central bank added to its gold reserves at the fastest pace in five months in November. Meanwhile, consumer demand in both China and India remains robust. As we reported in October, overall gold consumption on mainland China may meet or exceed the record set in 2013, and Chinese gold jewelry demand edged up half a percent year-on-year. A report in the Telegraph called China’s investment in gold a “buying spree” as “investors sought to shelter themselves from further market volatility.”
Meanwhile, according to the World Gold Council, India saw its first investment sector gold demand increase in the third quarter of this year since the third quarter of 2014, up 6% to 57 tons.
The bottom line is Chinese and Indians value gold and silver. And once they get it, they are reluctant to let it go.
Indian has been trying to entice people to monetize their gold for several months, with little success. Prime Minister Narendra Modi launched the scheme to tap a pool of more than 20,000 tons of gold lying idle in homes and temples as a way to cut imports. So far, the plan has attracted less than 1 kilogram per month, according to Reuters:
