Goldman Bearish Gold Call Overrun by Inflation: Argentina Credit

Argentines are buying more gold than ever to protect their savings from the Western Hemisphere’s fastest inflation as the country’s bonds suffer the worst returns in developing nations.

While Goldman Sachs Group Inc. called for gold prices to peak last month and billionaire George Soros cut his stake by more than half, Banco de la Ciudad de Buenos Aires, Argentina’s only gold trader, is talking with mining companies to buy the metal directly as surging demand exhausts its supply of scrap. The bank began marketing gold to individuals after the nation tightened currency controls in October 2011, selling 280 kilos in its first year for 102.6 million pesos ($20 million).