Record demand for gold as investors seek safe haven
Dollar demand for gold rose 45% in the third quarter compared with the previous quarter to reach $32bn as investors piled into the precious metal to seek refuge from the global financial meltdown.
Figures released by the London-based World Gold Council today said demand was being fuelled by exchange trade funds, and bars and coins.
Retail demand was particularly strong, rising 121% to 232 tonnes in the third quarter. Swiss, German and US investors were particularly keen investors during the quarter, said the Council.
Demand was so strong in the third quarter, said the Council, that there were widespread reports of gold shortages among bullion dealers.
ETF demand piled into 150 tonnes in the third quarter, with peak in inflows occurring in late September, triggered by the collapse of Lehman Brothers and a fear of banking sector failures.
In contrast, hedge fund sales of gold to raise cash and institutions liquidating commodity index investments, including gold, as fears of recession deepened, saw some outflows from gold investing during the third quarter.
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