Investors stock up on gold after major drop in price

Investors stock up on gold after major drop in price

GEORGE TOWN - Many investors are now stocking up on gold after world market prices for the precious metal plunged to its lowest in two years to RM139 (S$57) per gram or 5 per cent from RM146.35 last week.

Businessman H.C. Beh, 43, said he bought two 50gm gold wafers for about RM20,000 when the price was at its height about 18 months ago.

"I plan to buy more gold wafers now that the price is so low. I wanted to buy some a few weeks ago and I'm glad that I did not."

Housewife Grace Ramji, 30, said she was happy with the drop and had just bought her husband a bracelet using the money she saved.

Bank employee S. Melvin, 41, said she grabbed the opportunity to buy herself a gold item knowing that the price had dropped.

"When the price goes up, I will trade in my gold for a profit."

Monday's plunge of 9 per cent to RM133.35 from RM146.35 on Friday was the sharpest for the precious metal since Feb 28, 1983.

The price for gold as at 5pm yesterday was RM139.

The plunge has been attributed to worries over China's unexpectedly low estimate of 7.7 per cent growth in the first quarter.

In addition, cash-strapped Cyprus was reported last week as preparing to liquidate some of its 14 tonnes of gold reserve to fund its part of the IMF-EU bailout plan.

In Little India, a goldsmith shop assistant, who wished to be known only as Ina, said the price started dropping about 10 days ago at a slow rate.

"But about three days ago, there was a drastic drop. I dare not get new stock as I fear that the gold price could drop further.

"Many of us are making a loss as 1kg of gold is currently RM139,000 compared to about RM150,000 last week," she said.

Over at the Gayathrii Tangge Maligai Jewellers in Little India, business was booming as the tumbling gold price brought more customers to the shop.

Its owner, who wished to be identified as Radha, 48, said he had advised his customers to hold off buying gold as the price could drop even further.

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