After international gold prices hit a 24 year high last week, jewellers in Shanghai have said they will once again raise the price of gold jewellery from this Tuesday - the last hike was just a few weeks ago. The sky high prices have triggered a gold fever in the city with more people buying gold bars and jewellery as investments.

Jewellers in Shanghai increased the price of gold products on Tuesday as a result of the global gold price shooting up to a 24-year high of 527 US dollars an ounce in New York last Friday, with a weekly growth rate of more than 10 per cent over the last three weeks.

Officials with the Shanghai Gold & Jewellery Trade Association didn't quantify the pending price increase, saying it all depends on market developments.

The local retail gold price now stands at 157 yuan, or 19.4 US dollars per gram, an increase of 2-yuan this week alone and the 16th rise this year.

A sales manager with Shanghai Laofengxiang company, a leading local jeweller, estimated the price could rise to 160 yuan per gram, referring to the market in Guangzhou, where the retail price has risen 6 yuan to 166 yuan per gram.

Retail prices also jumped in Beijing and Fuzhou. During the past weekend, daily turnover of the gold store has approached 800 thousand yuan, even higher than that during the "Golden Week" holidays.

The price of gold bars also rose by about 2 yuan last week, but despite the soaring cost gold still appears to be retaining its allure as a safe haven for investors.

Local banks have seen an increase in the number of customers and the turnover of gold has jumped as people expect the price to continue its upward spiral as the New Year and the traditional Spring Festival approach.

Other sectors of the gold trade also saw a bullish market. For example, a gold trading product "Jinhangjia" was launched this July which differs from paper trading and allows buyers to demand the physical delivery of gold. Over the past 3 months, the amount bought in this way almost tripled. And report says the overall trading volume has been holding steady at around 10 kilograms a day.

Evening trade in gold is also booming in Shanghai since local banks began night trading last month.

Industrial and Commercial Bank of China Shanghai Branch has traded 10 kilograms of gold since December 1st when it began trading between 9:15pm and 11:30pm Monday to Thursday.

The Bank of China Shanghai branch said in the evening market, its paper gold product called "Huangjinbao" accounted for 1 third of the whole day's sales, after it began to sell paper gold 24 hours a day in the middle of last month.

The bank said some people only have time to trade gold in the evening, so their evening trade volume is expected to account for 50 percent of daily sales.

The evening market is synchronized with the global market, because it coincides with the closing of the London exchange and New York's opening.

The price hike has been widely attributed to higher demand due to several reasons, including unstable international politics, high energy prices and the prospect of rising inflation.

Source: CRI news