Gold News

Falling gold output 'will keep prices high'

The managing director of an Australian gold mining company has said that declining gold output from mines could conspire to keep gold prices high.

Lee Davis, of west Australian mine Silver Lake, said that gold mining is a difficult industry thanks to increasing costs and a lack of gold near to the surface.

"I believe the gold price will stay at current levels for the foreseeable future. Mine supply is decreasing and global demand is increasing, which should be a recipe for sustained high gold prices," he commented, according to the Australian Business.

However, he also acknowledged that this trend of steady gold prices could further damage the industry as demand outstrips supply, adding that the sector may need "a modern-day hero" in order to produce more profits.

Earlier this month, a spokesperson for the World Gold Council told the BBC's Money Programme that gold is "the ultimate defense" against the current economic climate since it is nobody's liability.

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