Gold closed lower again last week following a large decline the week before, although longer term safe haven demand continues to effect gold buying alongside Europe‘s debt woes and the generally weaker dollar.
However, higher prices appear to have slowed gold buying in India, especially during the countrywide celebrated harvest festival when demand normally surges.
Also of note, Fresnillo, the Mexican precious metals miner, reported 2010 gold output at 368,995 ounces, an increase of 33% and smashing its target of 340,000. Gold has been rising since the new millennium when it started under $300 an ounce.
After a decade gold was trading over $1000 an ounce. Analysis of past bull markets in precious metals show them often lasting around twenty years or more, so there should be at least a few years left of the current trend.
Physical demand remains firm with central banks entering the market as buyers once again and as we see increasing domestic demand from China, India and other Southeast Asian countries.
Gold reaffirmed itself as a legitimate investment class and with more people finally realising this we see the price of gold continuing to rise in the longer term.
