Ash Kundra, a United Kingdom-based dealer in gold, claimed that he had run out of coins and bars recently after demand skyrocketed for the precious metal. The pound’s plunge to a record low versus the dollar, as well as the turmoil in financial markets, is said to be the cause of the sudden increase in demand for the precious metal.
Demand for Gold ‘Increased Exponentially’
A United Kingdom-based gold dealer, Ash Kundra, has revealed that he repeatedly ran out of gold coins and bars in the days that followed the United Kingdom treasury chief Kwasi Kwarteng’s mini-budget proposal. Kundra, who operates from London’s Hatton Garden jewelry quarter, is quoted in a Bloomberg report suggesting that demand for the precious metal had “increased exponentially” following Kwarteng’s controversial proposals.
According to the report, the rush to gold by Britons came at a time when the precious metal’s U.S. dollar value was approximately 20% lower than its March peak of just above $2,060 per ounce. However, the turmoil in the U.K. financial markets, as well as the pound’s slide to a record low versus the dollar, meant gold was again a more alluring alternative.
This is partly what explained why the United Kingdom was scrambling for the precious metal. As Kundra observed:
I run out of coins and bars.
The Gold Collateral
Bullion Vault was an associate of the London Bullion Market Association. It is reported that more Britons than ever opened accounts for gold purchases at Bullion Vault.
Many British citizens have been known to seek safety and security in cryptocurrency, as well as buying gold. Messari, an international provider of cryptocurrency market intelligence products, has noted that there is a record amount of foreign investors in crypto. acquired bitcoinThe pound and the dollar both fell to an all-time low on the day they exchanged their currencies.
In the meantime, many people using gold in the U.K. as collateral, as well as using it as currency hedge to prevent depreciation. Commenting on Britons’ reported use of gold as collateral, Jim Tannahill, the managing director of Suttons and Robertsons, said he expects to see more and more of this.
“We anticipate we will continue to see an upward trend in people using gold as loan collateral in the coming months whilst this period of extreme uncertainty exists,” Tannahill is quoted explaining.
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