Gold demand rose 6 percent in the third quarter from a year earlier as Europe’s debt crisis spurred investors to accumulate the metal as a protection of wealth and push prices to a record, the World Gold Council said.
Global demand gained to 1,053.9 metric tons worth a record $57.7 billion, the London-based industry group said today in a report. Investor purchases of exchange-traded funds and products, bars and coins outpaced a drop in jewelry demand and increase in recycled supplies, the council said.
Gold climbed to a record $1,921.15 an ounce in London on Sept. 6 and is heading for an 11th consecutive annual increase. Holdings in bullion-backed ETPs yesterday were within 1 percent of the all-time high in August as concerns about Europe’s debt crisis and slowing economic growth boosted demand. European bar and coin demand topped that in India or China, the council said.
“I can’t see European bar and coin investment being poor in the fourth quarter given the euro-zone problem,” Marcus Grubb, managing director of investment research at the council, said in a phone interview from London yesterday. “When you look at China and India, the investment figures are likely to be good because you still have an inflation problem in both countries.”
Gold for immediate delivery traded at $1,769.77 an ounce at 4:24 p.m. yesterday in London. Prices averaged about $1,706 in the third quarter, up 39 percent from a year earlier and 13 percent higher than the second quarter.
Greece Turns to Budget After Winning Confidence Vote
Greek Prime Minister Lucas Papademos turns his attention today to finalizing next year’s budget, tackling a key demand set for the country to receive international financing a day after he won a confidence vote.
Finance Minister Evangelos Venizelos will present the 2012 spending plan to the new cabinet for approval before it’s submitted to parliament for discussion by lawmakers, which he said could be this week. Demonstrators at the same time will gather in Athens to commemorate a student uprising today.
“The policy of fiscal consolidation is necessary after the mistakes of the past several years to create the foundations for a new type of sustainable development,” Papademos told parliament yesterday. “The road is long and requires persistent effort and implies large adjustment costs.”
Papademos, a former European Central Bank vice president, won a three-month mandate to implement budget measures and ensure a bailout of 130 billion euros ($176 billion) agreed to with euro partners on Oct. 26. The first priority is to get a loan payment of 8 billion euros by the middle of next month to avert a collapse of the financial system.
A total of 255 lawmakers in the 300-strong chamber supported the confidence motion and 38 were against, Parliament Speaker Filippos Petsalnikos said yesterday.
