Singapore (VNA) - Gold dealers in Singapore have reported a surge in sales of gold bars and coins in the first four months of this year.
During January-March period, Singaporeans bought 2.5 tonnes of gold bullion, a 35% increase compared with the same period last year – the biggest year-on-year jump since 2010.
Despite the precious metal’s spot price breaking 3,000 USD in March and surging to 3,500 USD less than two months later, buyers do not appear deterred and sales are still going strong.
Analysts said part of the rush to purchase gold is due to hedging against economic risks, as rising global uncertainty pushes investors to go for a safe haven asset.
Gregor Gregersen, founder of The Reserve – a high-capacity vault for gold and silver storage in Changi, said some ultra-high net worth clients are switching over to physical gold.
Some clients are doing it because they want to materialise the gold. They might be having large positions in paper hold and they're getting more worried about what might happen, he said.
Shaokai Fan, the World Gold Council’s head of Asia-Pacific and central banks, said gold has proven its resilience during periods of instability. He added there are growing concerns about the future of traditional safe haven assets like the US dollar and US Treasuries.
But not all gold assets are being snapped up. Demand for gold jewellery fell 20% year-on-year in the first quarter, partly due to the record price environment.
Gold dealer Brian Lan said jewellery tends to cost more as there are labour costs involved in crafting pieces. Jewellery is also subject to goods and services tax (GST), unlike investment-grade gold bullion.
For the rest of the year, analysts said the appeal of gold with central banks will underpin demand, pushing prices to fresh all-time highs./.
