Investors No Longer Hoard All Gold Exported from Switzerland

During the months of the pandemic, a change in trend was detected in gold exports from Switzerland. Flows to Asian countries, whose metal demand for the jewelry sector severely reduced, decreased. Besides, exports to Western countries, Europe, and the US reduced. Exports dropped especially to those countries whose investors jumped in for gold as a safe-haven asset. However, the latest data point to a change in trend.

Switzerland is the largest international trading center for gold, so the data on its exports help to form an X-ray of the moment that exists in the world market for this precious metal.

The latest statistics published by the Swiss Federal Customs Administration regarding gold exports from the Swiss country reveal that demand in the retail and jewelry markets began to recover last November. Meanwhile, a drop occurred in investors’ appetite for the metal.

Gold exports to India, Turkey, Thailand, Italy, and Germany grew, but Hong Kong, China, and the UK plummeted

Thus, the data indicates that Switzerland exported significant amounts of gold to India and Turkey in November. At the same time, shipments to countries such as Thailand, Italy, and Germany (all with important markets for jewelry or bullion and coins) rose to reach the highest figure in recent months.

In contrast, exports to Hong Kong and China, which are traditionally the largest Swiss gold buyers, remained at minimal levels. Exports to the UK, a global gold investment center, plummeted to almost zero.

Gold exports from Switzerland to the United States have remained very significant. The futures market of the world’s one of the largest economies required banking of physical gold contracts. However, it almost matched the number of gold exports from the United States back to Switzerland. 

The truth is that the Covid-19 pandemic has caused a turnaround in the international gold market. Jewelry sales have plummeted but were offset by increased interest from Western investors, who turned to gold as a refuge from the global economic collapse.

This was a change in the trend that had been registered in recent years. Gold was moving from Europe and the United States in Asia’s direction. With the pandemic, gold flowed in the opposite direction, to the West. Meanwhile, prices rose above the record high of $2,000 an ounce.

Since then, the precious metal price has fallen below $1,900 an ounce, as investors’ optimism about the economic recovery has grown, diluting their interest in gold.