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By Ashitha Shivaprasad and Brijesh Patel

SINGAPORE (Reuters) – Demand for gold in Asia is rising rapidly even as prices remain close to record highs hit in May, industry officials say, as buyers flock to the metal to hedge against geopolitical and economic uncertainties.

The spot price of gold is currently just over $2,300 an ounce, up about 12 percent since the beginning of the year and only about 6 percent below last month’s record high.

The reduced confidence in other investment opportunities such as real estate and stocks is also a factor in the demand for gold, analysts say.

“As macroeconomic conditions return to normal and property and equities become more attractive, I think price sensitivity will return,” Ruth Crowell, chief executive of the London Bullion Market Association, told Reuters.

In Japan, there are more gold bulls than bears despite record high prices, says Bruce Ikemizu, chief executive of the Japan Bullion Market Association.

Chinese investors, grappling with currency devaluation, a prolonged downturn in the real estate market and trade tensions, are also finding gold valuable, experts say. China’s purchases of gold coins and bars rose 27 percent in the first quarter of this year.

“The trend in the market is that consumers buy gold when they want it. The price does not matter,” Albert Cheng, CEO of the Singapore Bullion Market Association, told Reuters on the sidelines of the Asia Pacific Precious Metals Conference.

Elsewhere in Asia, retail investors have also put their money into the safe investment as the metal becomes increasingly popular with younger buyers.

In Thailand, queues formed outside gold shops as soon as headlines about higher prices emerged, said Nuttapong Hirunyasiri, CEO of MTS Gold Group.

In Vietnam, investors are flocking to stock up on supplies, even though domestic prices remain stubbornly well above world market prices.

India and Australia, on the other hand, remain sensitive to high prices.

Indian gold prices have traded at a discount to the international price for five consecutive weeks, reflecting weak demand from the second-largest gold consumer, while sales of gold products from the Perth Mint fell 30% month-on-month in May. (GOL/AS)

India’s gold imports are expected to fall by almost a fifth in 2024 as record high prices have prompted retail consumers to exchange old jewellery for new rather than buy new ones.

(Reporting by Ashitha Shivaprasad and Brijesh Patel in Bengaluru; Editing by Mark Potter)

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