The following infographic, presented by GoldCorp and created by VisualCapitalist, explains the eclipsing gold demand of the East. The first part of the infographic shows how China and India combined account for more than half of the global gold demand when it comes to consumer demand. Statistics prove that this is a trend of the past decade, which has grown to a peak in 2013.
More interesting, though, is the second half of the infographic, where we can get a glimpse of future gold demand. In an attempt to answer the question why gold demand is so high in China and India, it appears that their citizens are simply becoming wealthier. So they are increasingly able to afford gold. Consider the following data:
GDP per capita India is steadily growing. In the last 10 years, the average GDP per Indian citizen has gone up with 60%.
Gold is part of their culture. In India, 30 to 50% of wedding expenses are gold. The first day of the yearly Diwali festival accounts for 10 tonnes of gold purchases.
GDP per capita in China has exploded in the last decade. It has gone up some 140% in the last 10 years.
The middle class in China is the 2nd largest worldwide currently. By 2022, China’s middle class will number 630 million. That’s all US and Europe population combined, but much (much!) more capital intensive.
Gold will continue to flow to the East, presumably coming from the West, in the decade to come. The question is what it will do for its price.
View the infographic here.
See also the Visual History of Gold.
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