While the U.S. and most of the Western economies talk down gold and the need to protect your wealth in a physical asset, one sector of the Eurozone is setting new records for physical gold sales in the wake of negative interest rates.
In 2015, the nation of Austria set a new record for gold sales, with a 215% increase over the previous record set one year earlier. And their 1.3 million ounces sold was greater than all sales made between the U.S. and Australia mints combined.
The Austrian Mint sold 1.3 million ounces of gold in 2015. This was up 215% from 2014 when the Austrian Mint sold 910 million ounces of gold. Austrian Mint gold sales in 2015 exceeded the combined 2015 U.S. Mint American Gold Eagle and Perth Mint gold sales.
Austrian Mint spokeswoman Andrea Lang told Bloomberg News that the Austrian Mint’s gold sales were a reaction to the negative interest rates instituted across the European Union. A common knock against gold is that it doesn’t pay interest. That complaint is neutralized when gold is compared against cash deposits, which lose money by remaining in bank accounts and are subject to potential “bail-ins” whereby depositors may lose some of their deposits if the banks where they keep their money become insolvent.
Gold was the best performing asset in the first quarter of 2016 and the Austrian Mint expects sales to remain strong through 2016. Indeed, in the first quarter of 2016, the European Central Bank announced additional stimulus and took interest rates further into negative territory. These initiatives should make gold even more attractive to cash depositors in Europe. - Finance.Townhall.com