Gold News

Gold Investment to be used by central banks as part of 'balanced portfolio of reserves'

The decision of European central banks to sign up to a new agreement which will cap sales of gold at 400 tonnes a year could be seen as an endorsement for Gold Investment, it has been stated.

George Milling-Stanley, managing director of government affairs at the World Gold Council (WGC), believes central banks have recognized the importance of having a Gold Investment in the current economic climate.

This has been reflected by their decision to announce a third Central Bank Gold Sales Agreement (CBGA 3) last week, Reuters reports.

"The attitudes of the central banks right now are a very solid reaffirmation of the ... value that gold can bring to a properly balanced portfolio of reserves," Mr. Milling-Stanley told the news provider.

A further indication of this is that the 400-tonne limit may not even be approached as central banks keep their reserves under lock and key.

"Sales under CBGA 3 will likely undershoot the 400 tonnes. It is just a ceiling, not a target," Mr. Milling-Stanley confirmed.

Tony Baird of Baird and Co is another champion of physical gold investment having explained in the Daily Telegraph that buying gold bars rather than coins represents a particularly attractive form of Gold Investment.

"On a weight-for-weight basis, premiums on bars are generally lower than for coins and this makes bars the more attractive proposition for investors," he told the news provider.

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