Did 'Safe Haven' Buying Spur Gold Price Jump?

London (Jan 14)  So did SAFE HAVEN demand drive gold prices to their multi-month highs this New Year?  asks Adrian Ash at BullionVault.

You'd think so reading news-wire headlines and the financial pundits.

But last month's price surge – gold's steepest gains since the UK's Brexit referendum shock of mid-2016 – in fact saw private investors take profit and sell.

With global stock markets losing 7.7% across December – the MSCI World Index's worst month since 2011 – speculators and ETF investors pushed gold prices in US Dollar terms 5.2% higher.

In contrast, users of BullionVault – the world's largest online marketplace for physical precious-metal investment – sold one-fifth of a tonne net between them (222 kg).

Equal to 0.6% of all client holdings, that pulled the total now stored in specialist vaults in each client's choice of London, New York, Singapore, Toronto or (most popular) Zurich down to 39.0 tonnes from end-November's new record high.

Compared to November, the number of people ending December with more gold than they began rose 5.6%, but the number of net sellers across the month leapt 75.8% to the most since January 2018.

Together that pushed the Gold Investor Index – a unique measure of private-investor action in physical gold – down from 53.4 to just 51.8 in December, its lowest reading since gold's 3.5% price jump of August 2017.

BullionVault