The gold price has increased by almost 29% in US dollar terms in the first eight months of 2016, and the World Gold Council’s John Mulligan says investor appetite for the precious metal will continue.
Mulligan, the Council’s Head of Member and Market Relations, says the conditions that have led investors to move into gold in very substantial numbers will “remain for some time.”
The Council's research reveals there have been 630 tonnes of gold ETF (exchange traded fund) inflows this year to date, and the increase in the price of gold has been the largest continuous gain since the European sovereign debt crisis in 2010 and 2011.
Mulligan argues that bullion has benefited from the failed policies of central banks. Quantitative easing (QE) programmes, he says, erode the purchasing power of money while raising the prospect of inflation. “It may not be round the corner,” says Mulligan, “but it’s on the horizon some time and that expectation of inflation often fuels investors turning to gold.”