FX.co ★ Royal Mint sees record demand for gold

In a press release published last week, the Royal Mint said demand for bullion products surged internationally, with US investors leading the way.

Investors have avoided paper gold for most of 2021, but appetite for physical gold and silver remained high in the last quarter of 2021. Reportedly, international sales in the fourth quarter of 2021 were up 14.4% compared to the same quarter in 2020, while purchases of one-ounce Britannia bars and coins from US consumers increased by 96%. International sales of silver bars also rose by 34%.

Germany and the US were the leaders of growth, and in January the World Gold Council revealed that the US bought 117 tons of gold bars in 2021, up 69% from 2020. That raised global demand for gold and bullion to 1,180 tons, 31% higher than the previous figure.

Analysts say it was rising inflationary pressures and growing economic uncertainty that made physical gold an attractive asset. Geopolitical tension is also a factor why demand for precious metals returned.

That is why it was not surprising that gold rose above $1,860 after geopolitical tension in the US escalated and after the Fed had an unscheduled meeting on Monday.