for gold coins soaring around the world 14-03-2009 - BI-ME
INTERNATIONAL. Demand for gold coins has risen sharply as
interest in the precious metal soars on financial instability
and investors' appetite for assets seen as a safe store of
Investors have used gold as a shelter from the impact of
the deteriorating economy on other assets, pushing the price
up and making jewellery expensive for consumers with shrinking
disposable income. Demand for physical gold products such
as coins and bars has been particularly strong, traders say.
The Royal Canadian Mint, which produces Maple Leaf bullion
coins, said it quadrupled its production capacity late last
year as demand for gold and silver bullion products leapt.
Gold is being driven by concern about the financial system
and lack of confidence in paper currencies,” said Adrian Day,
the president of Adrian Day’s Asset Management in Annapolis,
Maryland. “All the pressure is on the upside.”
The United States Mint said sales of its one-ounce American
Eagle gold bullion coins rocketed to 710,000 ounces in 2008,
from 140,000 ounces a year before.
"The demand for gold and silver has been unprecedented,"
a spokesman for the Mint told Reuters.
The chairman of the French Mint, Christophe Beaux, said sales
roughly doubled last year in value terms and are expected
to rise by another 50% this year.
The 2009 catalog the mint had produced was almost entirely
pre-sold, he said. The French Mint produces 100 euro gold
coins, and plans to mint 10-ounce and 1-kilo coins this year.
In South Africa, the world's third-largest gold producer,
Natanya van Niekerk, deputy general manager for numismatics
at the South African Mint Company, said she had seen a big
increase in demand for gold.
"I think we will see this same trend in this and the
next quarter," she said. "Gold surely has been resilient
in these times."
Michael O'Kane, head bullion trader at the New Zealand Mint,
said many overseas buyers had come into the New Zealand market.
"We're seen as a safe-haven market," he said.
He said buying had been strong since the collapse of US investment
bank Lehman Brothers in September, as investors moved money
from banks into hard assets like gold.
The mint was averaging "a month's transactions in a
day," he said, adding he saw demand continuing to rise.
Gold sales in Dubai's traditional jewellery market have collapsed
mainly because of the decline in tourist arrivals. Local jewelers
who have been waiting for a big chunk of tourists said that
less and less tourists inflow to the city has badly affected
the sale of the yellow metal.
Retail sales in Abu Dhabi’s gold market have fallen by more
than 70%, according to the Gold and Jewellery Group, due to
high prices. There will be fewer and fewer people who can
afford the intricate jewellery pieces in their windows.
But despite, high prices, demand has been soaring for physical
gold which is seen as a long-term investemnet and a safe store
As a result, there was an acute shortage of gold coins in
Dubai, during the recent shopping festival.
“People are coming and asking for gold coins. But there is
a terrible shortage of gold coins. Many gold and jewllery
shops in Dubai do not have the stocks of gold coins,” said
a manager with Joy Alukkas, a leading Dubai jeweller.