LONDON: The price of gold is set to win further support as investors shun struggling currencies, notably the dollar, metals consultancy GFMS predicted today.
“Looking ahead, further price gains were thought likely as the investment case was still perceived as strong, with for example all the major currencies now being questioned by investors,” London-based GFMS said in its latest annual survey on gold.
The consultancy added that investors were favouring the precious metal over currencies “in large measure due to high and rising levels of government indebtedness, and longer-term inflation threats still a growing issue for some.”
It cautioned however that “with no immediate reason for fresh investment to flood in, the rally might take a while to materialise.”
Gold, for which the two main drivers are jewellry and investment buyers, had smashed a series of records last year on the back of inflationary fears and increasing moves by central banks to diversify assets away from the dollar.
The glamourous precious metal, which is traditionally viewed as a safe-haven investment, hit a record pinnacle of $1,226.56 an ounce on December 3. Today in London trade, the price of gold rose to $1,153.75 an ounce, up from $1,148.25 late in New York yesterday.
Meanwhile, Zimbabwe’s quarterly gold production surged to more than one and a half tonnes on the back of increased mine output, the Chamber of Mines said yesterday. The chamber said the country’s quarterly production jumped to 1.667 tonnes, from zero production during the same period last year.
“By year-end we are looking at between 6,000 to 7,000 kilograms given that things have somewhat stabilised in the industry,” Chamber of Mines chief economist David Matyanga said, adding, “Monthly production figures keep going up and down like
