Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Investors pull gold from Hong Kong as tensions rise

Investors pull gold from Hong Kong as tensions rise

Private investors have begun to shift their holdings of gold from Hong Kong, months into the financial centre’s worst political crisis since the handover from British to Chinese sovereignty in 1997.

Gold is moving to Singapore and Switzerland as some individual investors eye other offshore jurisdictions to store their holdings of the precious metal, according to companies that sell gold in the city.

Hong Kong-based Joshua Rotbart, whose company sells physical gold to investors, said millions of dollars worth of the yellow metal was moving out of the city. In addition, no new clients were choosing to keep gold in the territory, he said.

“We don’t see any interest from new purchasers of gold to keep it in Hong Kong at the moment,” Mr Rotbart, a managing partner of J Rotbart & Co, said. “If someone now buys gold they will keep it elsewhere, and the immediate alternative is Singapore.”

Scott Schamber, managing director at Global Gold, a Zurich-based precious metals storage and services company with about 600 clients, said the company issued an alert earlier this month recommending its clients consider storing their gold in another location.

Gold is regularly flown between Hong Kong and Singapore, mostly in the form of kilo bars, depending on local prices for gold in both cities. One of Hong Kong’s main gold vaults is run by the international airport.

Mr Schamber said Global Gold, which has less than 10 per cent of the roughly $215m worth of precious metals it stores for clients located in Hong Kong, had become concerned that transporting gold out of the territory could become difficult after recent disruptions at the territory’s international airport.

“With China’s presence overlooking Hong Kong we’ve always kind of had that in the back of our mind anyway,” Mr Schamber said. A handful of its dozen or so clients in the territory has moved their holdings of the yellow metal to Switzerland.

Wealthy mainland Chinese clients are looking to buy gold in Singapore rather than in Hong Kong, Mr Rotbart said. “For Chinese clients, if you see [People’s Liberation Army] armed cars on the border and you hear the government saying we may need to enter Hong Kong, then that’s not an offshore centre any more,” he said.

Albert Cheng, chief executive of the Singapore Bullion Market Association, said he had heard of more inquiries by private investors to buy gold in Singapore recently, but that large physical gold trade flows had not been hit by the turmoil in Hong Kong.

“The private banking community says there are more inquiries,” Mr Cheng said. “But the actual flow is difficult to fathom.”

Most of the gold that China imports comes via Hong Kong and those flows have not been affected by recent turmoil, according to people familiar with the trade.

The People’s Bank of China curbed imports earlier this year in order to stop outflows of dollars, leaving large stocks of gold building up in Hong Kong. But the PBoC — which has taken such action before — has started to ease up on those restrictions this month, said industry insiders.

The movement of gold is also being portrayed as part of a shift in the private wealth management business in the region to Singapore. Philip Klapwijk, a managing director of Precious Metals Insights, who lives in Hong Kong, said: “There is a general shift in the private wealth business towards Singapore and the latest things in HK have only accelerated that.

“I’m not sure it’s so much ‘is my gold safe?’ It’s more HK’s star is fading and Singapore . . . is shining more brightly.”

Investors have eyed unrest in Hong Kong with growing unease. On Monday, Moody’s downgraded its rating of the financial hub’s outlook to negative, citing growing risks to its institutional strength amid continued integration with mainland China. The agency’s language echoed that used in rival Fitch Ratings’ downgrade of its rating for Hong Kong earlier this month.

Torgny Persson, chief executive of BullionStar, a Singapore-based gold dealer, said that “many” concerned investors had approached him about shifting holdings from Hong Kong.

“Singapore now …stands out as the premier location in Asia, if not the world, in terms of safety and rule of law for investors and savers looking for a stable jurisdiction for bullion wealth preservation,” he said.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Satirical Sketch Sparks Political Spouse Feud in South Korea
Indonesia Quarry Collapse Leaves Multiple Dead and Missing
South Korean Election Video Pulled Amid Misogyny Outcry
Asian Economies Shift Away from US Dollar Amid Trade Tensions
Netflix Investigates Allegations of On-Set Mistreatment in K-Drama Production
US Defence Chief Reaffirms Strong Ties with Singapore Amid Regional Tensions
Vietnam Faces Strategic Dilemma Over China's Mekong River Projects
Malaysia's First AI Preacher Sparks Debate on Islamic Principles
Meta and Anduril Collaborate on AI-Driven Military Augmented Reality Systems
Russia's Fossil Fuel Revenues Approach €900 Billion Since Ukraine Invasion
Alcohol Industry Faces Increased Scrutiny Amid Health Concerns
U.S. Goods Imports Plunge Nearly 20% Amid Tariff Disruptions
Italy Faces Population Decline Amid Youth Emigration
Trump Accuses China of Violating Trade Agreement
OpenAI Faces Competition from Cheaper AI Rivals
Foreign Tax Provision in U.S. Budget Bill Alarms Investors
Russia Accuses Serbia of Supplying Arms to Ukraine
Gerry Adams Wins Libel Case Against BBC
EU Central Bank Pushes to Replace US Dollar with Euro as World’s Main Currency
U.S. Health Secretary Ends Select COVID-19 Vaccine Recommendations
Trump Warns Putin Is 'Playing with Fire' Amid Escalating Ukraine Conflict
India and Pakistan Engage Trump-Linked Lobbyists to Influence U.S. Policy
U.S. Halts New Student Visa Interviews Amid Enhanced Security Measures
Trump Administration Cancels $100 Million in Federal Contracts with Harvard
SpaceX Starship Test Flight Ends in Failure, Mars Mission Timeline Uncertain
King Charles Affirms Canadian Sovereignty Amid U.S. Statehood Pressure
EU Majority Demands Hungary Reverse Anti-LGBTQ+ Laws
Top Hotel Picks for 2025 Stays in Budapest Revealed
Iron Maiden Unveils 2025 Tour Setlist in Budapest
Chinese Film Week Opens in Budapest to Promote Cultural Exchange
Budapest Airport Launches Direct Flights to Shymkent
Von der Leyen Denies Urging EU Officials to Skip Budapest Pride
Alcaraz and Sinner Advance with Convincing Wins at Roland Garros
EU Ministers Lack Consensus on Sanctioning Hungary Over Rule of Law
EU Nations Urge Action Against Hungary's Pride Parade Ban
Putin's Helicopter Reportedly Targeted by Ukrainian Drones
U.S. Considers Withdrawing Troops from Europe
Russia Deploys Motorbike Squads in Ukraine Conflict
Critics Accuse European Court of Human Rights of Overreach
Spain Proposes 100% Tax on Non-EU Holiday Home Purchases
German Intelligence Labels AfD as Far-Right Extremist
Geert Wilders Threatens Dutch Coalition Over Migration Policy
Hungary Faces Multiple Challenges Amid EU Tensions and Political Shifts
Denmark Increases Retirement Age to 70, Setting a European Precedent
Any trade deal with US must be based on respect not threats', says EU commissioner
UK Leads in Remote Work Adoption, Averaging 1.8 Days a Week
Thirteen Killed in Russian Attacks Across Ukraine
High-Profile Incidents and Political Developments Dominate Global News
Netanyahu Accuses Western Leaders of 'Emboldening Hamas'
Ukraine and Russia Conduct Largest Prisoner Exchange of the War
×