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18 December 2010

UK Gold shortages persist as interest in Gold and Silver still strong as holiday season approaches

Traffic and buying remain firm as Gold and Silver buying seen supported by recent dips

Shortages of certain types of Gold Bullion in the UK appear to persist. We first wrote of possible gold shortages in the UK of 1 oz Gold Philharmonics and fractionals of the same, here in August of this year.

Yesterday we saw supply of the Austrian Gold bullion coin on eBay UK completely dry up again. Given the large mintages of the coin in circulation, this may give a clue to the sentiment among those who currently hold Gold bullion coin.

The last time we saw such shortage, speculation about euro zone debt had been driving heavy uptake particularly by German buyers, draining the bullion coin market of Gold. This had spilled into the UK market causing Gold premium inflation. A variance arose of around 7% between 1 ounce gold bars in the US and 1 ounce gold bars in the UK. This time around gold premiums have remained roughly at parity around 19% for fixed price 1 ounce ingots. This strong premium appears to indicate robust demand for Gold Bullion bars.

In general, Bullionsupermarket traffic and interest remains higher than expected as the holiday season approaches with Gold and Silver buying seen supported by recent dips in price.

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