OZ Minerals head says gold demand will remain high

The head of a top Australian mining firm has explained today (October 21st) that he expects demand for gold to remain strong in the future.

Some market observers have suggested that commodities could be in for a tough time as governments around the world inject funds into ailing financial systems.

However, Andrew Michelmore, chief executive of OZ Minerals, the world's second-largest zinc producer - which also runs gold mines - has claimed that precious metals demand will be sustained.

He said: "There is still demand growth. We have not witnessed a decline for our products.

"All of our customers still want and need our products and no one is cancelling contracts."

Those views have been echoed by Frederic Lasserre, the head of global commodities research at Societe Generale in Paris.

He explained that despite the undoubted volatility in the market at present, there is still strong physical gold buying occurring, which makes an investment more attractive.

"Physical gold demand looks relatively robust," he said.

"The nature of last week's sell-off suggests that this represents a buying opportunity, but the market may not yet see it that way."

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