Gold is on track for its first annual loss in 13 years, but demand from buyers rose last month
11:40AM GMT 05 Nov 2013
Appetite for buying gold among individual investors rose to a six-month high in October, according to an index.
BullionVault, the world's largest online market for buying physical bullion, said its index – which measures the balance of customers adding to their gold holdings over those who reduce them – rose to 54.3 last month from 53.0 in September.
However, demand remains below the level of 56 a year earlier and below the peak of 71.1 in September 2011.
A reading of 50 on this Gold Investor Index signals an equal number of net gold buyers and sellers.
Adrian Ash, head of research for BullionVault in London, said: "The number of BullionVault users starting or adding to their gold holding increased slightly last month from September. But it was a 15pc fall in the number of net sellers which pushed the Gold Investor Index higher. Overall, net buyers outnumbered sellers better than two-to-one.
"Washington's short-term fix to the debt ceiling confirms there's no will to tackle spending or money printing long term. October's drop in the gold price let savers build their insurance at lower cost."
Gold is on course for its first calendar year loss in 13 years after the spot price collapsed from around $1,700 an ounce at the start of the year to a low of around $1,200 in June. A strong recovery to more than $1,400 in August went into reverse as global economic confidence grew over the summer - gold is treated as a safe haven during times of turbulence.
Today the price, at mid-morning, was at $1,312.
Mr Ash added: "With world stock markets now at five-year highs, average monthly gold prices have fallen in 10 of the last 12 months. That's something not seen since the bull market began in early 2001."
By weight, BullionVault users' gold holdings grew slightly in October to 32.3 tonnes.
Fans of the asset have been buying gold because of fears that spiralling global debts, which have led to mass money printing, will eventually create a currency crisis and increase demand for the world's oldest currency - gold.
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chow@royalindexuae.com
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