UK Gold Jewellery Demand Crashes 40% In October Compared To Last Year

Figures released by the British Assay Office for October 2011 reveal an incredible drop in numbers of pieces being hallmarked this year against last.

1. Hallmarking figures for October 2011 were down 40% for gold and 44% for silver against October 2010 – a massive decline for this time of the year.

That matches up with the fall in numbers of people heading out to the shops.

2. The number of shoppers heading to UK high streets was down by 4.7% in October. This was the sharpest drop in footfall since the bad weather last December.

Gold jewellery demand in the UK was 25 million items annually in 2003. It is now heading under 5 million pieces, and of those that are selling, the average weight is considerably reduced. This must equate to a 90% fall in the weight of gold jewellery being sold each year.

Such a drop in demand is not easily discernible from figures released by the industry’s other bodies, such as the World Gold Council, which represents the interests of the mining industry. Yet can Britain’s story be very different from that of all other countries around the globe?

Is the gold price boom bound to come to an end with jewellery demand on its knees? Once gold bullion speculators get cold feet,the price from here could crash, as they are the only buyers left in the field.

Jewellers are all waiting, it would seem for a return to more normal gold prices, and a return to work. In the past gold price surges have been more short lived, and trade was able to ride out the storm more easily. It is difficult to see how demand could fall much further. In fact scrapping activity is still very high, making net jewellery demand negative.

With Italy and other European debtor nations thinking of issuing debt backed by their gold reserves, is this the turning point? All the indicators would suggest that it is.

The Tap Blog is a collective of like-minded researchers and writers who’ve joined forces to distribute information and voice opinions avoided by the world’s media.

3 Responses to “UK Gold Jewellery Demand Crashes 40% In October Compared To Last Year”

  1. Anonymous says:

    More people have bought gold as an investment than there is physical gold available. 100* more.

    They’ll have to melt down jewellery to sate the demand.

    Jewellery is bad investment at this time because of the mark-up over the metal content.

  2. This mirrors our industry; sellers of gold significantly out number buyers, although buyers are buying more per order. The earth is still trembling for most people, and this instability is causing a stupor. Once a sort of stability returns, when people feel a little more secure, gold will rocket as the new normal dawns.

    The lucky ones bought metals years ago at fractions of today’s price and need cash today and for them the market is working well. The thing is; those sellers are also telling us they will return as buyers. That is when today’s prices will look cheap.

  3. Tapestry says:

    Cash is starting to become the best security. QE seems to have stopped. The US government is cutting spending by $1 trillion next year – cutting in the midst of a recession, after spending recklessly for fifteen years expanding debt by $1 trillion a year. It’s all arse backwards as they used to say on farms round here.

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