It’s been a scary start to 2016 for global markets, and investors are responding by buying more gold than any time in the past year.
In the past five days, investors bought 26.8 metric tons of bullion through exchange-traded products backed by the metal, the most since January 2015, according to data compiled by Bloomberg. Gold is one of the few commodities doing well, with prices up 1.3 percent so far this year.
Interest in the precious metal is being driven by demand for a safe haven after losses spread across Chinese and U.S. equity markets and oil dipped below $30 a barrel. Also helping the case for gold,China boosted reserves for the sixth straight month in December amid price declines through the end of last year, according to the People’s Bank of China.
“There is physical demand, and it is coming from individual investors more than anything else,” George Gero, a vice president of global futures at RBC Capital Markets in New York, said in a telephone interview. The metal “has been oversold. I think you’re going to start seeing some people starting to look at gold.”
Gold futures for February delivery dropped 1.2 percent to settle at $1,073.60 an ounce at 1:53 p.m. on the Comex in New York.
Not everyone is so optimistic. Prices may fall to about $955 in the fourth quarter and average around $1,000 over the full year, Mark Keenan, head of commodities research for Asia at Societe Generale SA, said in a Bloomberg Television interview on Thursday.
Silver futures for March delivery slid 2.9 percent to $13.748 an ounce on the Comex, falling for a fourth time in five sessions. Platinum futures for April delivery fell 1.9 percent to $834.80 an ounce on the New York Mercantile Exchange, while palladium futures for March delivery advanced 0.9 percent to $491.25 an ounce.