Gold News

Fears of 'equity retreat' prompting Gold Investment

Senior commodities analyst Mark Pervan suggested yesterday (September 8th) that investors are rushing to Buy Gold for its ability to provide a safe haven, the Guardian reports.

The yellow metal delighted its supporters on Tuesday by breaking through the psychologically-significant $1,000 per ounce barrier for the first time since February.

Now Mr. Pervan from ANZ Bank, which is the fourth-largest bank in Australia, has explained that Gold Investment is proving popular as fears over the state of the economy persist.

He told the newspaper: "Gold is rallying on fears of an equity retreat. The risk is that stocks will fall and people are hedging that by buying gold."

Those comments were echoed recently by Frank Holmes, chief investment officer at prominent mutual funds firm US Global Investors.

He explained that the huge debts accrued by the US government in response to the global financial crisis will continue to affect the dollar, which moves in the opposite direction to gold.

"The Federal Reserve's massive stimulus spending and the expectation that the current low-interest rate environment will continue for many more months are additional headwinds for the dollar and that tends to be positive for gold," he said, according to the Globe and Mail.

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