Record Turkish gold consumption not likely to last

Turkey's consumption of gold reached a record high in July, but demand may tail off soon.

Some 45.7 tonnes of the precious metal were imported into the country last month, which was more than four times the amount in July 2006 and the highest ever monthly figure.

"Because of the dollar's recent fall, people have started to buy gold . . . Coin purchases also increased due to weddings," Aycan Gold & Forex dealer Serafettin Ince told Reuters.

"But as of August that strong demand is no longer there."

Another trader agreed that, now that the dollar had recovered against the Turkish lira, demand for the yellow metal had declined.

At one point the local currency reached a six-year high against the greenback, with domestic gold prices rising as much as $8 above the international price.

However, these prices have eased now.

Meanwhile, gold demand in Abu Dhabi rose by ten per cent in July.