Political and financial turmoil drive strong demand...

 

GOLD and SILVER investment holdings have grown to record highs at BullionVault, led by a surge in UK investors choosing to own physical precious metals amid this autumn's political and financial turmoil, writes Adrian Ash, director of research at the London-based fintech.

 

Encouraged by a retreat in gold prices – down to 31-month lows in US Dollar terms and 8-month lows in both Euros and Sterling – users of BullionVault bought another quarter-tonne of the precious metal in October net of customer selling.

 

That grew the total quantity of gold bullion, all securely vaulted and insured in each client's choice of London, New York, Singapore, Toronto or most popular Zurich, by 0.5% to a new all-time record of 48.0 tonnes – more gold than most of the world's central banks hold in reserve. 

 

 

With the number of gold buyers rising and the fall in price deterring sellers, the Gold Investor Index – which would read 50.0 if the number of buyers was perfectly matched by the number of sellers – rose 0.8 points last month to 56.7, just shy of July's 13-month high. 

 

The Silver Investor Index also rose in October, adding 0.6 points to 53.6 as silver prices rose further from the summer's 2-year lows.

 

Like gold last month, silver holdings at BullionVault – now caring for $3.4 billion of precious metal (£2.9bn, €3.4bn, ¥489bn) for over 100,000 users from 175 countries – grew by weight to a new all-time record, expanding for the 7th month running and growing by 0.4% to a new record investment total of 1,267 tonnes.

 

 

So while gold's falling price is enough to deter fund managers and speculators in the face of rising interest rates, private investors are using these lower levels to start or expand their personal bullion holdings. New investment is running strongest in the UK, where this autumn's political mess continues to threaten both the Pound and financial stability.

 

Compared to a global rise of 18.4%, the number of new first-time bullion buyers living in the UK rose 56.0% in October from its prior 12-month average, and it came within 3.4% of March's level, when the Russian invasion of Ukraine drove the sharpest jump in new precious-metal investors since the very start of the Covid Crisis two years earlier.

 

As a proportion of all new users of BullionVault last month, that put the UK at 48.5%, its highest showing since January 2021.