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Banks fly bullion from Asian hubs to U.S. to benefit from premium
By Rajendra Jadhav
Reuters
Monday, February 3, 2025
MUMBAI -- Global bullion banks are flying gold into the United States from trading hubs catering to Asian consumers, including Dubai and Hong Kong, to capitalize on the unusually high premium that U.S. gold futures are enjoying over spot prices.
Traditionally, bullion banks transport gold eastward from the West to meet demand from China and India, the world's two largest consumers, accounting for almost half of global consumption.
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But alarm about U.S. import tariffs planned by President Donald Trump has driven Comex futures prices substantially above spot prices in recent months, creating a lucrative arbitrage opportunity.
"Gold prices are skyrocketing, and in Asia, demand has pretty much disappeared," said a Singapore-based bullion dealer with a leading bullion supplying bank. Spot gold prices hit a record high today.
"Meanwhile, a sweet opportunity has popped up in the U.S., and naturally, almost every bank is jumping on it -- moving gold over for Comex delivery to cash in on the arbitrage," he said. ...
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