Goldman Sachs: China gold demand may pick up on yuan weakness – BBG

 According to Goldman Sachs Group Inc, continued weakness in the Yuan and investors’ concerns over the outlook for China’s property market may spur gold demand in Asia’s top gold consumer, as cited by Bloomberg.

Analysts at Goldman Sachs noted, “The potential drivers of increased Chinese physical buying include purchasing gold as a way to hedge for potential currency depreciation in the face of capital controls.”

“Bullion consumption in China may also rise as a way of diversifying away from the property market. Chinese physical gold exchange-traded funds holdings have increased further, and appear correlated with recent yuan depreciation.”

“Should the recent decline in property prices in October and yuan depreciation continue we may see Chinese gold investment demand respond.”