A senior figure at ETF Securities has explained today (November 26th) that investing in gold is retaining its appeal as mines around the globe are struggling to keep steady output.
Gold production was down by 17.7 per cent in South Africa on a year-on-year basis in September, while annual output fell by 64.5 per cent in Zimbabwe during October.
Now William Rhind, head of sales for UK and Ireland at exchange-traded commodity specialist ETF Securities, has noted that demand will continue to rise as supply is suffering, Global Pensions reports.
He told globalpensions.com: "Annually the gold supply is falling and has been for some time. If you take away the financial market collapse, you still have a positive story with regard to gold.
"People sometimes forget gold is a finite commodity. It has to be mined; you can't print it like money. That is why it is seen as a store of value, a safe haven."
Chicago-based metals trader Matt Zeman corroborated such a view of gold recently and claimed that the concerted interest rate cuts around the world may eventually lead to a rise in inflation - to the benefit of gold investment.
"Gold may eventually rebound as global interest rate cuts devalue currencies and stoke inflation," he said.
"If everybody continues to drop rates and rates stay very low, inflation may come back with a vengeance. In that environment, gold would do very well."
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