Author: Paul Ploumis
09 Jun 2015 Last updated at 02:59:18 GMT
(Kitco News) - Not only is gold suffering because higher interest rates expectations and a stronger U.S. dollar, but commodity analysts at HSBC say that physical demand has also not responded to lower prices.
In particular the bank highlights weak demand from China and India.
"This is removing a floor on prices as Western investors have liquidated or gone short. Given these two countries' commanding presence in the physical markets and their long-run price sensitivity we expect further declines will eventually encourage them back into the market. But the market may have to go to USD1, 150/oz or lower before EM merchants are tempted to buy,” they say.
Courtesy: Kitco News
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