November 26, 2019 / 10:59 AM / 15 days ago

UPDATE 1-China's Oct net gold imports via Hong Kong lowest in three months

(Adds comments and details)

Nov 26 (Reuters) - China’s net gold imports via Hong Kong slipped for a second straight month in October, dropping to its lowest level since July, Hong Kong Census and Statistics Department data showed on Tuesday.

Net imports via Hong Kong to China, the world’s top consumer of the metal, decreased 8.3% to 10.846 tonnes in October from 11.829 tonnes in September, the data showed.

Total gold imports via Hong Kong, traditionally the main conduit of gold to China, fell 7.5% to 13.353 tonnes from 14.44 tonnes in September.

“Demand has been weak in China this year. Hence the low import numbers. Banks have also not been issuing quotas to import so supply going in has eased,” said Cameron Alexander, an analyst with Refinitiv-owned metals consultancy GFMS.

In September, China’s net monthly gold imports via Hong Kong fell 9%, while total imports dropped 8%.

China does not provide trade data on gold and the Hong Kong data may not provide a complete picture of Chinese purchases as gold is also imported via Shanghai and Beijing.

“More gold is being shipped via Shanghai these days. We have seen in recent years a shift to use Shanghai more then Hong Kong and the unrest recently has nothing much to do with it,” Alexander said.

Anti-government demonstrators have protested in the streets of Hong Kong for more than five months amid increasing violence and fears that China will ratchet up its response to stop the civil disobedience.

The protests are squeezing a market already pressured by Beijing’s decision to step up direct gold imports as it seeks to restrict outward capital flows.

International benchmark spot gold prices rose about 2.8% in October, with bullion being sold at a premium of $5 to $8 an ounce in China, world’s top gold consumer, over the benchmark prices last month. (Reporting by K. Sathya Narayanan and Eileen Soreng in Bengaluru, editing by Louise Heavens)

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