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Gold Prices to rise with SA production dip?

Gold Prices could rise as a result of the recent falls in production levels in South Africa.

Gold production in the country reduced by five percent last year, causing the country to fall to third place in the global production rankings.

South Africa now sits behind Australia, which leapfrogged it into second place.

Provided demand remains strong, the reduction in South African output could cause Gold Prices to rise as a result of diminished supply.

The global production statistics have been collated by GFMS, the international commodities research and consultancy firm, which has suggested fresh resources could compensate for losses incurred, such as those in South Africa.

With future Gold Prices linked to the demand and supply relationship, potential investors could be buoyed by recent comments by Walter de Wet, an analyst at Standard Bank Ltd, South Africa's largest bank, in London.

He told Bloomberg: "The dollar is still under some pressure. That is supporting precious metals. We've seen fairly good physical demand when prices drop."

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