Photo: Mamta Badkar
Gold jewellers and bullion traders across some of India’s largest gold markets recently called off a strike after 21 days.However, recent hawkish comments from the European Central Bank and the Fed have hurt gold prices.
But Frank Holmes of U.S. Global Investors who says gold demand is driven by the fear trade and love trade, says the latter is still around.
In an interview with CNBC he said:
“The ‘love trade’ takes place predominantly in Asia where people buy gold for the holidays. The seasonal pattern for gold is January to February with the Chinese New Year it’s up, and then falls in March.
Well that’s what it did this year. But that got exaggerated because there was a strike in India over the new tax on gold jewelry and it looks like that’s changing.
And it looks like we’re going to have the Hindu holidays coming up here at the end of April, so I think you can probably see demand coming from that love trade.”
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