Gold News

Demand for gold investment 'to be strong' in 2009

An analyst at Commerzbank has claimed today (January 19th) that demand for gold investment will remain strong in 2009 despite some negative macro-economic influences, Reuters reports.

New figures released on Friday showed that inflation in the US slowed to its lowest levels for 50 years during 2008, with the Consumer Price Index falling by 0.7 percent in December.

However, Eugen Weinberg, from Germany's second-largest bank, explained that people will still buy gold in large volumes this year because of its ability to diversify investment portfolios.

He told the news provider: "It is mostly a story about the US dollar, equity markets and inflation at the moment.

"Although given all these negative factors I still expect investor demand to be strong this year."

Mr. Weinberg's views were strongly supported last week by Peter Schiff, president of Connecticut-based brokers Euro Pacific Capital, who championed gold's safe-haven qualities.

He expressed his belief that the recent rally in the dollar will be short-lived, particularly when people realise that it does not represent as sound an alternative investment as gold.

"I think the dollar is a fundamentally flawed currency that is doomed to collapse and temporarily it's benefiting from the fact that it's seen as the alternative to everything else," he told the Melbourne Herald Sun.

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