Asian buyers rush in on gold price dip

SINGAPORE: Gold buyers rushed into Asia’s physical market yesterday, after prices retreated from the record high hit in the previous session, as investors maintained interest in bullion due to a shaky global growth outlook.

Spot gold tumbled 3.6% on Tuesday after striking a record above US$1,911 an ounce. Prices rebounded as buyers picked bargains, trading up 0.7% pto US$1,841.79 by 0701 GMT.

Dealers saw a flood of orders after Asia opened business yesterday.

“Everyone is hunting for physical gold now,” said a Singapore-based bullion dealer, adding that physical gold buying continued even when prices hit records in the past few sessions.

Premium on gold bars in Singapore steadied at 40 to 80 cents an ounce above spot prices, she said.

Some analysts have been warning about an overdue correction in gold prices, but the pessimistic macro environment has encouraged more investors to look into gold as an alternative investment.

“People don’t trust banks, stocks or bonds,” said Dick Poon, manager of precious metals at Heraeus in Hong Kong. “They have been buying physical gold at all-time high prices, just to diversify their portfolio to include gold.”

Physical silver purchase was also active, he added. – Reuters