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Wednesday, 4th March 2009 (1372 views)

Gold could become a leading choice of asset for investors as it can offer "low risk, stable returns and value preservation", an article has suggested.

According to the Indian Business Standard, demand for gold-backed securities and gold exchange traded funds remains strong internationally, as the metal appears to perform best when inflation rates are high and the US dollar is weak.

"Gold because of its limited supply continues to hold its own and is thus is considered as an effective inflation hedge," the article stated.

Jewellery demand traditionally accounts for more than two-thirds of total global gold sales, but this has changed over the past year as a result of growing worldwide demand and a strong retail market for gold coins and bars.

Gold prices have reached record highs of up to $1,023 (£725.6) an ounce in recent months and are expected to remain strong because of the global economic slowdown and restricted supplies.

The Chicago Sun Times recently suggested that investing in gold in the long term is generally a "reliable" way of storing funds and the metal is "glittering" in the current economic climate.

 

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