Tuesday, February 27, 2007
Malaysians increasingly see gold as money, not jewelry
Submitted by cpowell on 06:47PM ET Monday, February 26, 2007. Section: Daily Dispatches
Bullish About Bullion
By Edward Rajendra
KLANG, Malaysia -- Soaring gold prices have led to a new trend among buyers, who are now buying more bullion in the form of coins.
Malaysian Indian Goldsmith and Jewellers Association adviser N.P. Raman said, "Many regular buyers are now beginning to look at gold purely as a financial asset, adding to their investment portfolio.
"Many women now choose to buy gold coins or even bars as investment, instead of jewellery as jewelry adds 25 to 30 percent to the cost, to cover craftsmanship," he said.
Raman said the current investment-led buying has led jewellery shops in the Indian business enclave of Jalan Tengku Kelana here to display more gold coins.
"Before the prices started to climb, we had two types of buyers -â€" the ones who bought gold to convert it into jewelry for special occasions, and young executives who buy gold for capital appreciation," he said.
Raman said parents are now saving in gold coins as an alternative to traditional insurance policies that tied them for a stipulated period.
Some people were even buying gold coins on an instalment basis, by "depositing" cash with goldsmiths every month.
"People are not waiting to see if the market is going up or down but are buying bullion as it is considered a hedge against inflation. Market watchers anticipate that the price of gold may surge to US$800 (2,794 Malaysian ringgits) an ounce soon, due to Middle East tensions," he added.
The price of gold yesterday closed at 78 Malaysian ringgits per gram.
* * *