Sales of physical gold have gone up significantly in Europe in January. According to sellers this is mostly related to worries around the future of the Eurozone. On top of that there are the unexpected moves from central banks and the victory of the Syriza party in Greece. Consumers have become nervous.
The plans of the European Central Bank, the move of the Swiss National Bank and the elections in Athens, have caused the euro to drop 6.7% versus the dollar in January. The worst performance we have seen since mid 2012. This is good news for gold, however, since investors are now looking for a safe haven.
German gold trader Degussa saw his revenue grow by 35%, for example, compared to January of last year. Business was booming in January because of Greece and the Swiss franc said Wolfgang Wrzesniok-Rossbach, CEO of Degussa, to Reuters. Degussa had a record month in sales in Germany.
Motives To Buy Gold
Customers were also selling gold, he mentioned, thanks to the gold price expressed in euros that is now at its highest points in 21 months. Motives were different, but most of the sellers wanted to take profit. Some of them were also disappointed with the performance of the last 18 months and wanted to get out.
Austrian Min, one of Europe’s biggest coin sellers in revenue, also saw its revenue increase year-on-year in January by 6%. In the United States the company saw coin sales go down even last month by 11% to its lowest point in almost 3 years.
Europe’s QE program and the chances of a ‘Grexit’ have pushed many European savers into physical gold this year, says Andrew Leyland, analyst at GFMS. Until now that has also been a profitable move, the gold price in euros has gone up by 9% since the start of the year.
