Record high Chinese gold imports from Hong Kong support prices By Sara Sjolin LONDON (MarketWatch) — Gold futures Wednesday gained for a second day, reaching their highest level since mid-December, as Chinese gold imports from Hong Kong jumped to a record high ahead of the Chinese Lunar New Year. Gold for February delivery GC2G +0.48% added $8.20, or 0.5%, to $1,639.6 an ounce on the Comex division of the New York Mercantile Exchange. On Tuesday, futures rose 1.5% to settle at $1,631.50, breaking a two-session losing streak. The metal was supported by news that Chinese gold imports from Hong Kong surged to record highs in November for the fifth consecutive month. Last year, China overtook India as the world’s biggest market for gold, and the imports from Hong Kong are perceived as a proxy for overseas buying. The first quarter is traditionally a strong quarter for gold flows to China as the Lunar New Year prompts presents made of gold among friends and families, according to Adrian Ash, head of research at BullionVault. “We see an underlying strength in physical demand. People are buying gold as consumer items rather than investments,� he said. However, Ash also pointed to a change in the Asian consumer market, where people have started buying bullion for investments reasons as well. Gold investors also monitored this week’s euro-zone debt auctions. Germany on Wednesday sold 3.2 billion euros ($4.1 billion) of 5-year notes at a yield of 0.9%. Later this week, Italy and Spain plan to sell up to €17 billion in government debt. Investors tend to flock to safe havens such as gold and Treasurys during times of economic uncertainty. In the long term, gold will continue “to benefit from fund buying as speculative players rebuild their positions,� according to James Moore, an analyst at TheBullionDesk.com. Silver futures traded flat around $29.86 an ounce.

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