Gold Price Per

Following the recent decision by Britain to leave the EU, the value of gold priced in £GBP has soared. Investors made an immediate move towards “safe haven” assets. Compared to the end of 2015 gold is now worth a quarter more an ounce.

UKBullion.com, a leading online bullion marketplace, experienced record sales on the day the Brexit results were announced. The market has since calmed.

An important factor that contributes to gold price is the interest rate. Demand for gold typically soars when interest rates are low as they are currently in the UK. Although, gold has no fixed interest returns on your investment as you would receive with ISA’s or other cash savings it does however offer a better longer term investment.

The demand for gold worldwide is higher than ever. As countries like China and India who have a strong appetite for gold because of its cultural and sentimental significance. In India gold is seen as an investment for now and to pass down through generations. Gold also diverts savings out of the formal financial system, where they can be harnessed for tax. Only a third of Indians have bank accounts and gold, on the other hand, it is widely accepted without any documentation. It is an asset class that the authorities struggle to track. China has been increasing its gold holdings at an incredible pace. The central bank gold reserves increased by 71.4pc in the past 12 months, compared with a global increase in central bank reserves of 2.85pc.

Gold miners have been biggest beneficiaries of raising gold prices. As the price of gold goes up, the miners’ margins improve, meaning the potential return to investors goes up.  Therefore, equities become a better bet than holding the underlying commodity. With gold prices already having a great start in 2016, forecasts predict they will continue for the remainder of the year as gold usually has much better performance in the second half of the year because of buying patterns relating to festivals in the Middle East, India and China, as well as Christmas in the West.

With the price of the British Pound still falling, gold is at a 28 month high with some stocks having been affected positively. As the world has usually seen; when there are major global events the markets reflect the impact. No one knows if the markets will even out or continue to show the consequences of the BREXIT.