Year of the Golden Boar to spark Chinese gold buying
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Year of the Golden Boar to spark Chinese gold buying

Year of the Golden Boar to spark Chinese gold buying

The Chinese New Year of the Boar starts on February 18 on the Gregorian calendar and coincides with a metals year on the five year elemental cycle and the metal associated with this is traditionally gold. It is also called the Year of the Golden Boar and comes around only once every 60 years.

    This has already affected gold purchasing in China with bank's stocking up to meet anticipated demand. And at the end of last year the Shanghai Gold Exchange lowered the size limit for trading in gold bars from one kilogram to 100 grams in a move to make trading in the precious metal more accessible to small private investors.
    'So the combination of Boar (good fortune) and metal (gold) might well lead to additional private investment in the precious metal once the New Year starts – and this should be made easier by the much lower threshold of entry,' reported
    The ChinaDaily has noted: 'Greeting the upcoming 'Year of the Golden Boar' in 2007, domestic banks are enthusiastically unfolding gold marketing strategies, while customers are busy buying up gold for their financial portfolios with the New Year just ahead.'

    Weaker US dollar

    Shinhan Bank Product Development Division's Goo Hyun-su is quoted as saying, 'With the price of gold rising due to the recent weakening dollar, interest in gold has increased. Moreover, the preference for gold jumped with the next year being the Year of the Golden Boar.'
    Therefore it looks as if we need to add the Chinese Year of the Boar to the list of bull factors in the gold market, and the yellow metal has entered the New Year with a flourish with prices at their highest levels since May last year.

    Delving further into Chinese astrology and the Year of the Boar is also associated with violence and wars brought about between a clash between the fire and water elements. However, wars and geopolitical events are indeed likely to coincide with higher gold prices this year.

    Gold and wars

    Veteran gold analyst Jim Sinclair, whose market timing has been spot on for 40 years, keeps reminding visitors to his website that we live in a world beset by geopolitical uncertainty. So this could well prove to be the tipping factor of higher gold prices in the Year of the Golden Boar.

    Besides it is surely not unimportant if superstitious nonsense persuades more than a billion of the world's inhabitants that this is a year auspicious for investing in gold. Surely this prophesy will tend to be self-fulfilling if enough people believe it.

    For what is most needed to drive the gold price above its previous all-time high of $830 reached in 1980 is a hoard of new buyers. A nation of more than one billion souls might just be enough.
    AMEinfo Staff

    AMEinfo staff members report business news and views from across the Middle East and North Africa region, and analyse global events impacting the region today.

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