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Tuesday, 20th January 2009 (1545 views)

People will still buy large volumes of gold this year in order to diversify their investment portfolios, according to a financial analyst.

Eugen Weinberg from Commerzbank told Reuters that demand for gold will remain strong during 2009 because of a series of economic conditions.

The German banking expert explained that the US dollar and equity markets rates will all have an effect on gold investment levels this year.

However, prices will also be affected by jewellery demand and falling inflation rates, he cautioned, insisting that he still expects "investor demand to be strong this year".

An interim update to its annual gold survey by GFMS has stated that the outlook for gold investment is "robust" this year, in spite of adverse global economic conditions.

According to the report, investing in gold will help to safeguard people from the effects on money markets of fiscal decisions made by politicians, Mineweb reported.

 

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