Tanaka Kikinzoku Kogyo K.K., Japan's biggest bullion retailer, said sales to local investors may exceed purchases this year for the first time since 2004 as lower prices and the yen's weakness spur buying interest.
"Japanese individuals are thinking of gold as an asset for their investment portfolio as well as insurance for the future," said Kate Harada, general manager of the precious metals department at Tanaka Kikinzoku, a unit of Tanaka Holdings Co. "A growing number want to use gold partly to hedge against their yen-based assets such as stocks and properties."
The slump into a bear market in April spurred demand for jewelry and coins around the world and the second half of the year usually sees gains in physical demand for weddings and religious festivals in Asia, including India and China, the biggest buyers. Gold in London slid 23 percent last quarter, touching a 34-month low of $1,180.50 an ounce on June 28, after investors lost faith in the metal as a store of value and as the Federal Reserve said it may taper stimulus.