CHINA July 28 2015 12:15 PM

SHANGHAI (Scrap Register): Although mainland China’s gold imports from Hong Kong fell in June, analysts expect imports from the Far East to increase in the coming months. 

Data released from the Hong Kong Census and Statistics Department showed that China’s imports via Hong Kong fell by 48% month over month, and by 8% year over year, to the lowest level since August 2014, said Simona Gambarini, commodities economist for U.K.-based research firm Capital Economics. 

She added that this data suggests that gold’s price drop still has to feed through into higher buying. However, Gambarini expects total imports by China and India to pick up in the second half of the year as low prices attract a fresh wave of buying. 

She added that the Swiss Federal Customs Administration also revealed that China’s imports via Switzerland fell in June by 25% month over month, but are up 368% year over year. 

“We think investors are becoming increasingly worried about a more pronounced correction in China’s stock market and will return to gold to diversify their portfolios,” Gambarini added.

As such, she adds that the firm expects an overall increase in consumer demand of 4% from India and 3% from China year over year.