PETALING JAYA: Local gold demand is likely to go down in the near future as concerns over the last Overnight Policy Rate (OPR) hike, higher bank interest rates and expected further US Federal Reserve tightening could decrease or dampen Malaysians’ purchasing power.
According to Public Gold Group founder and chairman and Malaysian Gold Association (MGA) president Datuk Wira Louis Ng, the overall increased bank interest rates could affect local demand for gold as reduced disposable income will lessen purchasing power.
He explained that due to the decreased disposal income, consumers will likely focus on making loan repayments or spending their income on essentials such as food and housing.
Meanwhile, he said gold players are worried about the impending Luxury Goods Tax (LGT) which could affect the demand for gold even more.
“Gold players are worried about LGT, that it will worsen the demand. More so, they’re seeking authorities to consider this prior to implementation,” he told SunBiz.
He opined that exports of gold jewellery were affected severely during the Covid-19 pandemic and recovered only recently. However, he believed that “Malaysia is bound for another fall when the impending LGT is imposed on gold products”.
In March, MGA had discussions with local authorities about LGT, and shared their analysis on the impact the tax would have on the gold jewellery segment, which includes gold import and export activities, manufacturing, wholesale, as well as on retail segment such as domestic and tourism sales.
Earlier this year, Ng said MGA had organised the first Malaysia Gold Conference (MGC), aimed to provide local gold industry players with the latest insights on foreign gold markets, gold prospects as well as current gold market trends. Recently, he attended the Asia Pacific Precious Metals Conference 2023 (APPMC 2023) in Singapore.
“The government should encourage its linked agencies to participate in these gold conferences in the near future to ensure that the country gets first-hand information on the world’s precious metals industries.
“This will not only be helpful in formulating effective government policies to promote better future for our local gold industries, but also ensure that our country remains competitive in the global gold arena,” he said at APPMC 2023 .
Furthermore, he shared that Malaysia’s gold demand had been greatly impacted by the Covid-19 pandemic. Despite that, investment gold demand peaked during the Movement Control Order (MCO) period.
“The demand for investment gold spiked during the MCO period due to rise in gold prices, implementation of government’s fiscal support programme, moratorium bank loans and social restrictions – all these contributed to more cash in hand for investors to stock up on physical gold.
“However, gold demand dropped post-MCO due to economic recovery, decrease in investment sentiment, inflationary pressures and change in consumer preferences – more travels,” he said.
Source: The Sun Daily
A word from our sponsor:
Need Help With Your Personal Finance / Money Issue or need a coach to help you structure or just want to learn the financial skill to self manage your financial matters and retirement. iLearnFromCloud.com
Need to solve a problem quickly, now you can solve it by learning the art of problem solving Art Of Problem Solving
Feeling hungry. Latest food news from Best Restaurant To Eat Malaysian Food and Travel Blog
Memory loss. Need to organize better. Solve problem fast with Free Mind Mapping Software Mind Mapping 101
Need A Customized System Development for your business or Going Paperless XPERT TECHNOLOGIES - Empowering The Paperless Economy
No comments:
Post a Comment