- POSTED: 09 Jun 2014 22:13
- UPDATED: 09 Jun 2014 23:16
Bullion dealers said that demand for precious metals like investment-grade gold and silver is rising in Singapore -- this is due to the recent weakness in prices as well as tax-exemption in Singapore.
SINGAPORE: Bullion dealers said that demand for precious metals like investment-grade gold and silver is rising in Singapore -- this is due to the recent weakness in prices as well as tax-exemption in Singapore.
Precious metals investors overseas are also looking more to Singapore as a haven to store their hoard.
According to retailer BullionStar, demand has roughly doubled in the first half of this year compared to the same period in 2013.
Singapore aims to have a "gold-standard" environment for buying, selling and storing investment-grade precious metals -- typically gold or silver products of close to 100 per cent purity.
Since October 2012, such metals have been exempted from the Goods and Services Tax (GST). And according to BullionStar, this has drawn interest domestically and overseas.
BullionStar offers storage services for precious metals, on top of dealing in physically-backed bullion. Its average monthly sales has grown from about S$2.5 million to more than S$5 million from 2013 to 2014.
BullionStar said the US dollar's recent strength has prompted investors to shift from gold to currency, leading to a dip in prices of precious metals. But it is optimistic that prices will rebound.
Vincent Tie, a sales manager with BullionStar Singapore, said: "If the prices of gold remain at the current levels today... it's very easy for a few entities with sufficient amount of currencies to buy out the entire, or even the annual supply of gold.
"However, the way I see it is when that demand comes in, it will inevitably push up the price of gold in the international markets."
Those who hoard gold seem to like Singapore's robust and secure infrastructure for storage.
The Singapore Precious Metals Exchange said it has been "bombarded" with enquiries, and 95 per cent of its global clients are looking to Singapore for protecting their gold.
Victor Foo, chief executive of the exchange, said: "We basically got a lot of our customers to move existing bullion from their homes or from other countries into Singapore. But what we do is, in that asset transfer service, we help them to first authenticate their bullion before it is deposited."
The exchange also lets customers buy and sell bullion on a peer-to-peer platform and has a retail arm that has diversified its product offerings.