Gold prices edged higher on Tuesday despite signs of weaker Chinese imports.The yellow metal closed at US$1,286/oz in London, up US$8.75 from Friday, after markets were closed on Monday for the UK bank holiday.
 

The price increase was probably on the back of geopolitical concerns across the world, Commerzbank said in a note, and came despite continued US dollar strength and lower Chinese imports.

Imports to China via Hong Kong slowed to 21.1t (678,365oz) in July from 36.4t in June and 52.3t in May, Standard Bank said in a note. The bank believes 90% of China's gold is imported via Hong Kong.

Imports in Asia as a whole are expected to remain weaker this year than last, partly due to import duties in India and strong physical buying in 2013, which was driven by steep drops in gold prices.

"We believe that market expectations have been adjusted to the lower gold price, and that it would need to move lower to spur demand," the bank said in a note.

Gold prices have moved lower in August from July's average of US$1,310.97/oz, partly due to concerns over physical demand, which the World Gold Council said dipped in Q2. Silver ended the day unchanged at US$19.49/oz.

Source:- bnamericas.com