Gold price surge rekindles interest

Press, 21 May 1987, Page 24

Gold price surge rekindles interest

By NZPA business reporter JOHN CALLAN Wellington A surge in the U.S. price of gold has caused renewed investor interest in the metal, both in New Zealand and overseas. Gold hit SUS4BI an ounce in New York yesterday, its highest U.S. price since February, 1983.

The new peak is the result of a worldwide resurgence in precious

metals as a secure investment and as a hedge against inflation. New Zealand gold trade was now the busiest it had been since gold reached SNZ94O an ounce in October, Mr Dino Mavros, the Wellington manager of the Auckland Coin and Bullion Exchange said. All the traditional indicators pointed to gold going even higher in the short term, he said. Pointers such as a weak U.S. dollar, the big U.S. trade deficit, firm US crude oil prices, a succession of tumbles in the Dow Jones Index and no easing in international tensions were all good for gold, Mr Mavros said. And a nervous New Zealand sharemarket has been a catalyst in turning local investor attention to

precious metals. The distinct lack of gold sellers indicates that most investors seem confident gold will continue up as high as SUSSOO an ounce.

With some foreign exchange dealers picking a weakening in the New Zealand dollar in the next few weeks, those investing in gold could make money on both the bullish bullion and the foreign exchange market when selling, he said. While AC & B’s biggest commodity trading volumes lately have been in gold, silver has shown the biggest percentage price increase in recent months. After spending nearly three years at about SUSS an ounce, silver recently doubled in price, but now sits at 5U59.54 an ounce.