BullionVault Demand Gauge Jumps to 16-Month High After Bear DropClaudia Carpenter
BullionVault, an online service for investors to buy and sell physical gold and silver, said its Gold Investor Index climbed to a 16-month high last month as the biggest price drop in three decades triggered more demand.
The index jumped to 58.6 in April, the highest since December 2011, from 53.3 in March, the London-based company said today in an e-mailed report. A reading above 50 means more buyers than sellers. Gold tumbled 14 percent in two days last month, the biggest decline since 1983. It traded at $1,462.61 an ounce by 6:57 a.m. in London, down 13 percent this year.
Bullion declined in April as Cyprus said it intends to sell part of its gold reserves and investors in exchange-traded funds sold the most tonnage for any month on record. BullionVault said new-account openings were the strongest since January 2012.
“While this surge in new business is already easing, it shows the strength of pent-up Western household interest in physical bullion, which was previously deterred by higher prices,” Adrian Ash, head of research at BullionVault, said in the report. “The response to April’s sharp fall is redolent of Asian gold demand. Developed-world savers didn’t chase prices higher in late 2012. Now they’re buying the drop.”
The index peaked at 71.7 in September 2011 and was at a six-month low in March. Gold climbed to a record $1,921.15 in September 2011 and rallied 11 percent in the third quarter last year, the most in two years.
BullionVault’s customers own gold worth about 1 billion pounds ($1.56 billion), the company said. The metal is stored in vaults in London, Zurich, New York and Singapore.