Gold and Risk Aversion
Investors are buying gold as they are more risk averse to other financial investments such as, stocks and shares and paper currencies. Support for gold as a safe haven for assets is gaining momentum.
Analyst Walter de Wet states that “we still think the bias is for gold to move higher in the next couple of weeks. It’s the usual stuff, Europe’s overhanging debt…Also as long as US rates remain low the carry cost of holding gold is low so that should support”.
With the constant threat of inflation, global financial worries, low interest rates and China’s recent announcement to allow greater flexibility in their exchange rate, the future of gold bullion remains bright.
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