U.K. Royal Mint's Gold Sales Jump 20% Amid Political Turmoil

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  • March sales jump 263% after declines in January, February
  • Gold has risen 12% this year to about $1,285 an ounce

The U.K. Royal Mint’s gold sales jumped by a fifth in the first three months of the year, according to figures obtained under freedom of information legislation.

Following month-on-month declines in the first two months, March gold sales jumped 263 percent in volume-terms, according to the information sent by email. Gold sold and stored by the mint under its Signature Gold program, which allows the partial ownership of bars held in its vault, jumped 178 percent in March, compared with a year earlier.

Demand for bars and coins, particularly in Europe, is being driven by negative interest rate policies as well as worries over political instability ahead of votes in France, Germany and negotiations for Britain to leave the European Union, according to Metals Focus Ltd. analyst Junlu Liang.

Political Risks Push Gold to Five-Month High on Haven Demand

“We’re still seeing safe-haven demand in Europe, with both macro uncertainty and political uncertainty,” Liang said by phone from London. “You have negative rates in both real and nominal terms, plus we had Brexit last year and elections fast approaching in France.”

The increase in purchases follows a sharp gain in prices, with spot metal increasing in each of the first three months, the longest run since 2012, according to data compiled by Bloomberg. Trading at $1,287.12 an ounce, it has risen 12 percent this year, according to Bloomberg generic pricing.

“We saw strong sales across all markets, but particularly from Germany and the U.K.,” Chris Howard, director of bullion for The Royal Mint, said by email. “We experienced strong demand for gold in physical products during the period, notably with our Britannia 1-ounce coin.”