“Our customers are looking to park their wealth somewhere”
Two companies are reportedly planning to open new gold vaults in Europe as demand for the safe haven asset surges amid a rise in inflation and geopolitical concerns.
The gold price hit a seven-month high earlier this week, within about US$5 an ounce of $1,300/oz but had eased this morning to $1,285/oz.
Terror attacks, tension in the Middle East, Brexit, inflation and negative interest rates are all contributing to gold’s appeal.
Both CoinInvest, a European-based gold dealer, and UK bullion merchants Baird & Co are opening new vaults capable of holding more than US$110 million in gold, according to Bloomberg.
The pair will offer customers lower costs than exchange-traded products and protection from rising prices, the wire service said.
CoinInvest CEO Daniel Marburger said one of his customers in Germany had just been charged negative interest rates on his bank account.
“That is definitely a driving factor and will lead to more sales and also more storage clients,” he told Bloomberg.
Baird & Co CEO Tony Dobra said his customers wanted to “park their wealth” somewhere and were comfortable with the fluctuations in the gold price.
“They know gold’s never going to be zero,” he told the wire service.