VIENNA, Dec 14 (Reuters) – The Austrian Mint, one of the world’s oldest and largest producers of gold coins, cannot keep up with demand as people rush to find a safe haven for their money amid the unrest of inflation and economic fears caused. through the war in Ukraine.
“Demand for gold has not been as high as this year,” Mint Chief Executive Gerhard Starsich told Reuters in his ornate office in a building in Vienna where coins have been struck since the 1830s. Behind its quiet facade lies a warren of workshops where modern machines melt metals and waste money.
“Right now, every gold coin that comes off the coining press has been sold,” Starsich said. “Now we can sell three times as much as we could.”
The Mint store, a modern corner building, had a long queue outside every day for months. Among those standing in line is pensioner Renate, one of the few willing to talk about her shopping habits.
“I’m from an older generation. Whenever things are uncertain we go back to gold coins and tell ourselves we’ll always sell them,” he said. “Gold has that safety factor.”
Starsich says customers are of all ages and from all walks of life. About one-third of the Mint’s sales are to foreign buyers.
The Mint was founded in 1194 to strike coins from the silver that was paid as a ransom for Richard the Lionheart, after he was captured and held captive by enemies near Vienna.
Today, the Mint says the one-ounce Philharmonic gold coin, named after the world-famous Vienna Philharmonic Orchestra, is the best-selling gold coin in Europe and Japan.
[1/7] Gold coins are seen at the Austrian Mint factory in Vienna, Austria, December 13, 2022. REUTERS/Lisa Leutner
HOARDERS
Austria is a fiscally conservative country where the public keeps cash and gold in times of crisis. The Mint says demand for gold is the highest since it was minted in its current form in 1989.
The Austrian National Bank, which owns the Mint, said in a presentation on Austrian household finances in October that more gold had been bought in the two and a half years since the coronavirus pandemic began than in five years. before.
It noted that demand for gold in the first half of this year was higher than in the first half of 2020, “despite rising prices”, suggesting a rush to an asset seen as a safe haven.
“It’s a cascade,” Starsich said of the causes. “It started with the corona crisis, with the pandemic, when people were restless. Then in February Russia invaded Ukraine. That boosted sales again.
This year at the end of November the Mint has sold more than 1.8 million ounces of gold and is approaching the record of more than 2 million set in 2009 after the global financial crisis. December sales are usually strong as gold is a traditional Christmas gift.
Starsich added that the gold rush is a global phenomenon seen in other major national mints. The price of gold is currently at $1,800 per ounce, short of its peaks above $2,000 in March of this year and August 2020.
He said he believes more Austrians are looking to include gold in their portfolios as a hedge against stocks or to diversify their portfolios. Many analysts doubt gold’s usefulness in curbing inflation, however.
Reporting by Francois Murphy Editing by Alexandra Hudson
Our Standards: The Thomson Reuters Trust Principles.
