Physical demand 'preventing major Gold Price falls'
A prominent Standard Bank employee has claimed today (October 5th) that Gold Investment is propping up prices at present, Reuters reports.
The yellow metal has surpassed the $1,000-per-ounce mark on several occasions in the past few weeks, but has often fallen back significantly when testing this level in the past.
However, Yuichi Ikemizu, Tokyo branch manager for Africa's largest bank, explained that physical Gold Buying demand means previous resistance is being overcome.
"Long futures positions likely increased over the past week, showing how persistent those longs are," he told the news provider.
"Selling pressure isn't as strong as last year, with physical demand emerging when prices fell towards $980 last week to underpin the market."
Meanwhile, Wallace Ng, chief precious metals dealer at Fortis Bank's derivatives unit, offered a similar view in an interview with Bloomberg last week.
He explained that gold is currently proving to be a popular investment as uncertainty over the nature of the expected economic recovery is curbing risk appetite.
"Investment demand will continue to drive the market. [Falling stock prices may] encourage a flight to safety," he told the news provider.
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