Interviews
Robust global demand brings spark to gold prices
19 Mar '08
4 min read
The gold price fixed above the 'symbolic' $1000.00/oz mark reaching $1,003.50 at the London PM fix, after sailing through previously uncharted territory since the start of the year. On 3 January this year the gold price reached $865.35/oz, breaking the $850/oz record set momentarily back in 1980.
The rise translates to an annual increase of more than 52 per cent on the average price in March 2007, which sat at $655.89/oz.
Moaz Barakat, World Gold Council's Managing Director for the Middle East, Turkey and Pakistan commented: “The gold price has continued to surge forward on the back of strong investor sentiment reaching the $1000 mark, much quicker than even many bullish analysts had predicted.
“We are seeing encouraging recent trends particularly in the investment sector, in a number of the world's key gold markets as investors take 'flight to quality' in the face of the credit squeeze and ongoing financial turbulence.
Global events, including a falling dollar and rising inflationary fears, have combined with strong gold market fundamentals to create positive conditions for the gold price.
Whilst the rising and volatile price has been a highly positive trend for those already holding gold, it has posed a short term problem in regard to consumer purchases of jewellery, gold bars and coins, acting as a disincentive to some buyers.”
Investment demand for gold reached an all time quarterly record of $8 billion in Q4 2007. Over the year total demand for gold reached an all time high of $79bn. Today's $1000/oz record follows a sustained rise in price over the past six years.
The World Gold Council identified the following short term reasons for the recent gold price rise:
• Inflationary fears as a result, in particular, of high oil prices. Gold is seen as a hedge against inflation; while its real value can vary in the short term, its purchasing power has remained stable over centuries.
The rise translates to an annual increase of more than 52 per cent on the average price in March 2007, which sat at $655.89/oz.
Moaz Barakat, World Gold Council's Managing Director for the Middle East, Turkey and Pakistan commented: “The gold price has continued to surge forward on the back of strong investor sentiment reaching the $1000 mark, much quicker than even many bullish analysts had predicted.
“We are seeing encouraging recent trends particularly in the investment sector, in a number of the world's key gold markets as investors take 'flight to quality' in the face of the credit squeeze and ongoing financial turbulence.
Global events, including a falling dollar and rising inflationary fears, have combined with strong gold market fundamentals to create positive conditions for the gold price.
Whilst the rising and volatile price has been a highly positive trend for those already holding gold, it has posed a short term problem in regard to consumer purchases of jewellery, gold bars and coins, acting as a disincentive to some buyers.”
Investment demand for gold reached an all time quarterly record of $8 billion in Q4 2007. Over the year total demand for gold reached an all time high of $79bn. Today's $1000/oz record follows a sustained rise in price over the past six years.
The World Gold Council identified the following short term reasons for the recent gold price rise:
• Inflationary fears as a result, in particular, of high oil prices. Gold is seen as a hedge against inflation; while its real value can vary in the short term, its purchasing power has remained stable over centuries.
Popular News
Leave your Comments
Editor’s Pick
Esteemed Clients
-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Telangana State Industrial Infrastructure Corporation Limited (TSllC Ltd)")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Taiwan Textile Federation (TTF)")
