Gold News

Systemic risk in the dollar 'prompting Gold Investment'

A prominent figure at Saxo Bank claimed yesterday (June 2nd) that investors are looking to Buy Gold at present because they sense weakness in the US dollar, Reuters reports.

The yellow metal is often viewed as an alternative investment to paper currencies and in particular the greenback, with which it has historically shared an inverse relationship.

Now Ole Hansen, senior manager at the Danish online investment bank, has explained that Gold Investment is proving popular as insurance against declining purchasing power.

He told the news provider: "All this talk about systemic risk in the dollar and where you can hedge yourself against, that means commodities will be favored."

A similar view was expressed last week by Edison Investment Research analyst Charles Gibson, who noted that central governments' huge fiscal output to tackle the recession will ultimately benefit gold.

"History suggests they [the governments] will probably overdo it. Gold is sailing and the wind is behind it," he told Fund Strategy.

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