Gold sellers in Hong Kong and Mainland China are expecting a surge in demand for the precious metal this year. The boost reportedly happens quite regularly during the Year of the Rat as it is often considered by traditional Chinese people as the best time to get married and have babies.
The expected boost is a much-needed reprieve for the country's gold industry given last year's dismal performance. According to the president of the Chinese Gold and Silver Exchange Society, Haywood Cheung Tak-Hay, the second half of the previous Chinese New Year was a relatively bad year for gold jewelers across the country. He explained that the civil unrest in Hong Kong particularly damaged overall sales; with some shops reporting up to a 70 percent drop in sales.
Cheung revealed that most jewelers are now feeling more positive given the start of the Year of the Rat. The New Year in China officially began on January 25, marked by the start of the country's Lunar New Year holiday season. The Year of the Rat is the first animal on the Chinese zodiac and represents the start of the 12-year cycle. The other animals on the zodiac, in order, include the ox, tiger, rabbit, dragon, snake, horse, goat, monkey, rooster, dog, and pig.
Cheung revealed that the demand for gold will no doubt increase in the coming months as more people will be getting married and have kids. It is a tradition in the country for relatives from both sides of soon-to-be-married couples to purchase gold jewelry as gifts and as dowry.
The particular Chinese zodiac year is also a popular year for having babies among the traditional Chinese people as those that are born during the Year of the Rat are considered to be smart and clever. In Chinese tradition, family and friends often give gold jewelry to newborn babies. This includes bracelets, earrings, and even custom minted gold coins with zodiac animals.
Cheung predicts that gold prices will be lifted further in the coming months, likely to hit $2,188 per tael. His prediction equates to about a 17 percent increase compared to the closing price of gold before the start of the new Chinese year.
While the Year of the Rat often results in a surge in gold sales, the Year of the Dragon is actually the most profitable Chinese year for gold sellers in the country. According to experts, the Year of the Dragon is the most popular year for weddings and having babies. During the particular zodiac year, gold sales in China more than doubles when compared to any other year.
