Hedge funds slash bullish wagers on gold over Trump election win
The precious metal has fallen about 8% from a record high on Oct. 31, with losses accelerating after Trump’s election victory last week.
India, the world’s second largest gold consumer after China, should start a bullion board to regulate trade and a spot exchange to offer uniform prices across the country, according to the World Gold Council.
In a study published Tuesday, the market development organization for the gold industry outlines seven key policy recommendations to monetize the 22,000 tons of gold stocks kept by Indian households:
1. Establish an India Gold Exchange to ensure pricing standardization, increase transparency and improve supply and demand analysis.
2. Establish a Gold Board to manage imports, encourage exports and facilitate development of the infrastructure needed to ensure the Indian gold market functions to maximum effect.
3. Develop accredited refineries in line with international standards including upscaling the current domestic refineries.
4. Allow Indian banks to use gold as part of their liquidity reserves. This would incentivize them to introduce gold-based savings products.
5. Drive monetization of gold by incentivizing banks, revitalize Gold Deposit Schemes, introduce gold-backed investment and savings products.
6. Create a more active marketing strategy for Indian handcrafted jewellery. This could boost exports and highlight India’s expertise in this highly-valued sector e.g. by promoting handcrafted ‘India-made jewellery’ like the Swiss-made watches.
7. Drive the standardization of gold so that buyers and sellers can have faith in both the quality and price of their products. Introduce guidelines for compulsory quality certification of all forms of gold to encourage accountability and foster an environment of trust.
The report also assesses the policies adopted in countries like Turkey and China, which have faced challenges similar to India, but chose to devise public policies to monetize the local stock of gold. Here, some of the key findings:
(Click to enlarge)
3 Comments
DJ
With 16000 tons of gold under its wings for so long, India should have been at the front stage with the gold price setting elite group. What a shame that India let its absolute advantage went waste for the longest time. But it is never too late. It is time to wade into the world gold stage and be the number one price setter on gold. Also, India should announce more solar power projects of 100…200…300 GW capacities in order to soak up all the household silver. Without big shinny projects leading the way, how does the population understand the importance of monetizing the precious metals in their own hands. Talk is cheap but laying out the concrete steps on the road map is by far the first and foremost.
DJ
Do not let anybody outside India to tell your women what gold jewellery they should be wearing. It is time for India to tell the rest of the world what jewellery taste their gals should have.
Firdaus Abbasi
This article harps back to themes WGC had pre-millenium. Even the photo seems to be from that era. WGC appears staid as an organ for
gold markets. Gold is not so important today in investment or in jewellery camp. The development of design, manufacturing and reliable quality of
product offer in India is a repetitive theme; it got off to a flying start by
the WGC in the 1990’s and seems not to have progressed by much. Most India was gold jewellery mad. But, now? Promotional
strategy in Italy and Europe of the 1990’s proved great but disappeared as it is in India today. Contrast this to DeBeers (formed from easier global structure) which has consistency over the long term!