Tuesday, October 5, 2010

JPMorgan reopens New York gold vault as investors scramble for yellow metal

From the UK Telegraph:

JPMorgan Chase has reportedly reopened a gold vault in New York as banks seek to profit from the yellow metal's longest rally since 1920.

The reopening of the vault, which was closed in the 1990s, is also evidence that there's appetite from investors to actually buy the metal itself, rather than just gain exposure to gold through mining shares or other assets, the Financial Times reported.

"There is growing interest from ETFs (exchange traded funds) and other institutions as well as from corporates and high-net worth individuals to store precious metals," Peter Smith, head of JPMorgan's vaulting service, told the FT.

The gold price is already up 20pc this year and, with a 10th straight year of gains in sight, is on course for its longest rally since 1920.

The prospect of the US and the UK embarking on another round of quantitative easing is sparking fears among some that inflation will inevitably follow.

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