Hong Kong’s jewellers, who took a big hit from months of anti-government protests, have found their shops busy again this year.
But the new wave of customers are not shopping for bracelets, wedding rings or earrings. They are there to sell their gold jewellery.
Sellers are taking advantage of the gold price, which has climbed almost 10 per cent this year to reach a seven-year high early last week. The rapid spread of coronavirus has dampened stock markets globally, and investors have been rushing to buy the yellow metal, long known as a safe haven.
International gold jumping 1.5 per cent to US$1,703 per ounce on March 9.
“I am thinking of taking my gold jewellery to sell as the gold price has reached such a high level,” said a potential seller who only wanted to be identified as Sandy. “I bought my gold jewellery some years ago when the price was almost 30 per cent lower than current levels. “I can take the profit now and buy them back when the price goes down."
Such a “sell high, buy low” mindset is very common in Hong Kong, where most jewellery shops will pay cash for customers’ gold jewellery or allow them to exchange it for other products.
It is not just Hong Kong other jewellery shops in Southeast Asian countries are allowing customers to sell gold. It is because gold has an international standard. It is rather more difficult for customers to sell diamonds at shops as that depends on more factor such as colour and quality.
Gold remains a good hedge against market risk, some analysts are predicting the gold price will stay at around US$1,650 to US$1,700 per ounce by the end of this year.