What happens to gold exports as gold prices continue to rise?

The Swiss customs authority published data on gold exports on Thursday. August Swiss gold exports show no shipments to China for the first time since January 2021, notes Carsten Fritsch, commodities analyst at Commerzbank.

Demand for physical gold is low due to the high price

“It was notable that there were no shipments to China and only minimal shipments to Hong Kong. The last time this happened was in January 2021. Almost no gold was delivered to the US either. There was almost a 60% drop in deliveries to the UK.”

“Net inflows into gold ETFs in August, with US-registered gold ETFs seeing inflows of almost 12 tonnes and UK-registered inflows of just over 4 tonnes according to the WGC, would have indicated higher deliveries. On the other hand, gold exports to India increased by nearly 40%. India’s significant cut in gold import duty could have played a role here.”

“However, the Swiss data clearly shows that the high price level is having a dampening effect on the demand for physical gold.”