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Saturday, April 18, 2009

Gold remains most secure investment: World Gold Council

The Hindu :Gold remains most secure investment: World Gold Council

With the current economic slowdown and dwindling returns on investment from other options, gold continues to remain the most secure investment according to the World Gold Council (WGC). As per data released by the WGC, gold has provided an annual average return of 26 per cent over the past decade (between 1999 and 2008). With the average gold price having grown every year, gold has always provided positive returns every year over the decade.

In the first quarter of 2009, gold has provided a positive return of 17 per cent when compared to the average annual price of Rs. 12,147 per 10 grams for 2008. The average price for the first quarter of 2009 was Rs. 14,180. The first quarter also saw the gold price peaking at an all time high of Rs. 15,780 on February 24. The average price of gold in 1999 was Rs. 3,850 and since then, it has provided an absolute return of 216 per cent with every year of the decade providing an annual return on investment (RoI) above 24 per cent (except 2006 when RoI was 19 per cent).

Commenting on gold’s sustained upward trend, WGC, Indian subcontinent, Managing Director Ajay Mitra said, “gold jewellery has been treasured, sought after and popular since the beginning of Indian history and till date, bears an extraordinary significance especially during festivals. The presence of a safe asset like gold in an investment portfolio ensures assured returns, which further adds to its appeal.”
“There is a strong buzz in the trade community that if the trend continues, Indian consumers could possibly witness a further appreciation of around 24 per cent assuming that the rupee dollar remains the same. It would be fair to say that this is the most favourable time to buy gold,” according to the WGC.

Gold Survey 2009, a study launched recently by GFMS (formerly Gold Field Mineral Services), a leading precious metals consultancy, predicts that in the coming months, gold could easily re-attain the $1000 an ounce mark, with an added expectation of crossing the $1100 barrier. International gold is currently hovering around $880-890.



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