What is the interest determination of Hong Kong Gold Market about?
Interest determination is one of Hong Kong Gold Market’s characteristics. The determination of interest is done once a day at 11:00 during weekdays and at 10:30 on Saturday. Positive interest arises when the demand for physical gold exceeds the supply. Buyers cannot get hold of gold are awarded interest paid by sellers who cannot deliver gold. Negative interest arises when the supply of physical gold exceeds the demand for it. As a result, sellers who do not get sale proceeds are awarded interest paid by buyers who do not have sufficient cash to pay sellers. Even interest arises when supply and demand for physical gold or cash are in equilibrium – that is neither party has to pay the interest. Interest is quoted in Hong Kong dollars per ten taels.
