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Thursday, 1st October 2009 (3774 views)

Investment demand for gold is continuing to increase as a result of inflationary concerns, according to one expert.

Barry Wainstein, global head of the foreign exchange and precious metals division at Scotia Capital, told the Toronto Star that many people are still worried about inflation, prompting them to seek out the safe haven properties of gold.

His comments came after Scotia became the first Canadian bank to offer direct gold bar purchases over the internet, a move that was triggered by growing demand for the precious metal as the recession continues to affect the stability of the financial markets.

The bank experienced an increase of almost 40 per cent in gold demand last year compared with 2007.

"Gold is the ultimate safe haven," Mr Wainstein said.

David Chapman, an investment adviser and strategist for MGI Securities, added: "Money is becoming more worthless every day, so you want to get into something that's a hard asset."

The Perth Mint in Australia recently reported a surge in demand for gold bullion, with sales of bars, coins and medallions up by 50 per cent in the 12 months to June.

It also attributed this increase to investors looking to the precious metal for stability during the financial downturn.

 

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