India is also hedging against the US dollar, and has moved 2.3 percent of its reserve holdings into gold. This $6.7 billion deal to buy 200 metric ton signaled bullion markets yesterday, which have pushed the price of gold to $1084.50.
Central banks, after many years of selling gold reserves, have reversed course and are rapidly driving up the price of gold with large purchases.
If you're looking to speculate on gold, China and the IMF are still likely to make large purchases of their own. Also, gold still provides a safe investment in uncertain times.
Wednesday, November 4, 2009
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