ROTHSCHILD WEALTH MANAGEMENT – the discretionary asset-management arm of Rothschild Private Bank – is holding a "large" Gold Investment position to defend its clients against weak currencies and the threat of inflation, according to its latest asset allocation report.
Now running some €12 billion ($15.7bn) for clients each holding €5 million or more in investable assets ($6.5m), Rothschild Wealth Management's head of investments, Dirk Wiedman, says gold is "increasingly attractive as the only truly hard currency."
He warns that "for now, gold may well remain volatile" as investors run for safety in US Dollars and a credit squeeze in the banking sector forces some institutions to raise cash by selling gold.
But "leaving aside the short-term fluctuations, we believe the long-term outlook is bright and that the investment case for gold remains robust," says Wiedman, calling Gold Investment "the main beneficiary of central banks' extremely loose monetary policies," which may allow inflation in the developed West to rise sharply in a bid "to erode the burden of debt.
"Against that backdrop, we continue to hold large positions in gold as we seek to preserve and grow the real value of our clients' wealth," concludes Rothschild Wealth's head of investment.
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