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Rising gold prices have underlined the precious metal's reputation as a safe haven in troubled times, and New Zealanders are taking notice.
Spot gold crashed through the psychological US$700 ($951) barrier this month and hit a 28-year high of US$739 an ounce on Friday, amid US inflation fears and a falling greenback.
Part of the reason is higher oil prices, against which gold is used as an anti-inflationary hedge, but other global factors are also involved.
At New Zealand Mint head bullion trader Michael O'Kane notes that New Zealanders haven't been traditionally big on gold, but they are increasingly wanting to buy and even trade it.
A one-ounce coin bought when the New Zealand dollar was worth US81c cost $910 in July, and could be sold back at $1000 an ounce today.
Mr O'Kane says demand is rising. "We're starting to see a lot of people come through [saying] 'I've pulled money out of my finance company' or 'I don't want to go into one'."
One-ounce gold bars and coins are the most common investment, although coins are considered more recognised overseas because the same dimensions tend to be used. Gold jewellery isn't really classed as currency internationally.
At antique dealers Walker and Hall in Wellington, manager Alwyn Knox said there had been a rise in enquiries over the past two months, although most people are buying not selling. "We've actually found that there is a shortage because people are holding onto it because of the price going up."
It is possible to enter the gold hedge fund market, but O'Kane says hedge funds tend to trade in line with stock markets, whereas bullion is regarded as "anti-inflationary" and trades defensively.
"If you have a stock market crash or significant drop in the stock market, physical gold actually increases in value quite significantly. Gold hedge funds, because they're listed on the stock market, will quite often behave in a similar fashion."
Gold's doing very well globally, due to world conditions, forecasts of a good wedding season in jewellery-mad India, and demand in China.
About 70 per cent of the world's gold production goes into jewellery, 15 per cent into manufacturing and dental products and the rest into investment. But that ratio is shifting in favour of investment, he said.
A few people buy ingots and New Zealand Mint does not vet buyers, except for the odd casual question.
O'Kane said: "I've come from a foreign exchange background and it's ... different. I have a few clients who, all I know is first names ... whereas in the foreign exchange game, you didn't get to know names but you knew exactly what was happening with the funds all the time."
- NZPA
