Gold investment ‘could rise due to dollar concerns’
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Monday, 22nd June 2009
An increasing number of investors could opt to purchase gold due to ongoing uncertainty over the use of the US dollar as a reserve currency, an expert has suggested.
According to Emma Plumpton of stockbroker Redmayne-Bentley, a weakening in the price of the US currency usually brings a rise in the value of the precious metal, the Press and Journal reports.
She noted that gold’s ability to protect against inflation and deflation means many see it as a “quasi-currency”, adding that it has “traditionally provided a safe haven for investors at times of political and monetary instability”.
Ms Plumpton also stated that the market has recently opened up to a much wider group of investors, meaning gold is no longer reserved only for those with wealth.
Her comments echo those made by Sham Gad of Gad Partners Funds, who recently told Investopedia that investors should follow the lead of serious hedge funds and consider buying gold.