Gold prices surged as much as ten percent representing the highest level in more than two years after BREXIT on 23rd June. The vote sent investors scurrying for protection through buying gold and other assets perceived by investors as low-risk. In other words, gold delivered double-digit percentage for investors running away from currencies such as Sterling Pound for the first time in three years.
On Friday, June 24, 2016, Spot gold peaked at $1358.20 per ounce up from $1,319.86 an ounce. The shares of gold mining companies were up with fund tracking the industry opening with as much as eight percent higher. The scenario can only tell us that Brexit benefited gold because it is a natural, safe haven when the global economy is doing badly. Gold priced in Sterling Pound recorded the highest increase in the price of about 14.5% having peaked at 1,019.03 pounds from 965.80 pounds.
The gold dealers in London and other parts of the UK recorded a surge in the demand for gold both on coins and bars among retail investors on Friday. On the other hand, dealers in the stock market were having a bad day on Friday as stock prices plunged across the board. BREXIT vote forced the Prime Minister to leave office in a scenario that seemed the biggest hindrance to the European project of greater unity.
The day after the election saw the Sterling Pound fall to a record lowest in the last three decades. The Brexit vote was significant in its way because it showed how global currencies are tagged to the stability and politics of an economy. However, gold which derives its value from scarcity increases its price during economic turmoil.
According to Crunchbase, Money Reserve is one of the biggest distributors of the world gold. Recently, the company has recorded a surge in the demand for gold amid the realization by many investors that gold is the ultimate safe place to safeguard wealth. The president of the agency, Philip N. Diehl was recently named the new chairman of the Industry Council for Tangible Assets (ICTA). The council is entitled to act as the “watchdog” for paper money, rare coins, and precious metals. Diehl is credited with accomplishing a lot in the U.S. Mint and leading U.S. Money Reserve to improve its customer service to the best ever.