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Gold is still holding its attraction as a safe haven for investors in the light of volatile equities, a sliding dollar and the exacerbating macroeconomic outlook in the USA. According to Natalie Dempster, Investment Research Manager at the World Gold Council (WGC), says: “The ongoing credit crisis and increased market volatility in Q1-2008 caused investors to seek safe haven investments, pushing the price of gold to a new all-time high.”
Investment demand for gold has risen from 9.0 % of total demand in 2001 to 20.0 % last year and is displacing jewellery demand which has fallen from 77.0 % to 68.0 % in the same period, according to GFMS, the precious metals consultancy.