SA Gold Coin Exchange chief bullish about metal’s prospects
miningweekly.com
By: Creamer Media Reporter
22nd May 2009
Updated 1 hour 27 minutes ago
JOHANNESBURG (miningweekly.com) – The gold bull market was well set to extend itself strongly into the future, said the South African Gold Coin Exchange (SAGCE) executive chairperson Alan Demby.
He explained that SAGCE had experienced a rapidly growing demand for its gold coins in recent months.
“During the course of 2008, the value of SAGCE’s sale of gold coins, primarily Krugerrands, was a substantial 80% higher than in 2007. Especially popular were the gold Mandela medallions, partly because of their sentimental attraction, and partly as a result of their gold content,” Demby said.
He added that although SAGCE had grown its market share, this had played a minor role in the company’s headlong revenue growth, which Demby was convinced emanated from the belief that gold was the ultimate hedge against the uncertainty generated by the global financial meltdown.
During the fourth quarter of 2008, total bullion demand in India was up by 84%, compared with 2007 figures, while gold demand in greater China was up by 21%, Demby said. Demand from Thailand soared by over 100%, while the Middle Eastern gold bar and coin demand rocketed by 139%.
“Record demand has also spilled into the first quarter of this year, sending total global demand for gold in the form of exchange-traded funds (ETFs), coins, bars and futures past the $100-billion mark – for the first time ever.”
Moreover, Demby said that gold demand through ETFs shot up by 469 t, a full 223% over the previous record set in the third quarter of 2008. Coin and bullion demand was expected to be just as strong as the 396% surge in the fourth quarter of 2008.
“It should be no surprise, then, that the price of gold continues to trade above its 1980 high of $850, and rising. All the data clearly revealed that we are looking at a bull market more powerful than almost anyone is ready to admit, so powerful that it would not come as a surprise if the price hit $2 000 before the end of next year,” Demby stated.
“The evidence is incontrovertible. Those who miss the gold train will seriously regret having been left at the station,” he concluded. |
