London (AFP) – In London’s Hatton Garden jewellery quarter, stores have raised their iron shutters to welcome a motley crew of buyers and sellers, as the price of gold reaches record highs.
“I know that whatever they offer me first, I’m going to say no,” joked Jennifer Lyle, who had come to sell an old gold bracelet and single earring, after recently losing her job. Lyle, 30, recounted how just a day earlier she had watched a television show in which a woman who bought a gold coin in 1996 for £60 found it was now worth £550 ($676). “That’s a good increase, isn’t it?” Lyle said joyfully.
The price of gold struck 40 record highs last year as global demand reached an all-time peak of 4,974 tonnes, the World Gold Council (WGC) said in a recent annual report. The record run has extended into 2025, with gold striking a record high close to $2,900 an ounce on Friday. Central banks are purchasing gold in big quantities amid geopolitical and economic uncertainty, with the precious metal regarded as a safe haven investment.
– Stretched budgets –
At Touch of Gold, a Hatton Garden shop run by Naqash Anjum, gleaming gold necklaces and bracelets were on display. But for some, a jewellery item deemed affordable not long ago was now too expensive. “This is like consistently increasing prices. What was selling well …now can’t sell well because it’s become out of (someone’s) budget,” said Anjum. He added there are “more people trying to sell” than buy, impacting sale volumes of jewellery with Valentine’s Day fast approaching.
According to the WGC, while global demand for jewellery dropped 11 percent in 2024, total spending jumped nine percent, reflecting the price increases. “Would I buy gold as an investment?” asked Lyle, repeating the question posed to her by AFP. “Yes!” she answered emphatically.
In Hatton Garden, where diamonds and precious metals have been traded since the Victorian era, pawnbrokers as well as gold dealers and designers operate alongside the jewellery stores. Tamer Yigit said he no longer custom makes jewellery out of pure gold, instead using blue resin. “We can no longer create models directly in gold, because it is too expensive and there’s a big risk that we can’t sell them,” said the 50-year-old who started out in the industry as a child in Turkey.
As Yigit spoke, a customer entered his shop looking to sell a broken gold bracelet and a silver coin with a portrait of Louis XVI. “You can’t imagine the amount of allegedly gold jewellery that turns out to be alloys based on copper and other metals,” said Yigit as he prepared authenticity tests on the metals. While the results confirmed the gold was pure, the coin was found to be an alloy of zinc and copper.
But one young man, who would only give his name as Gilly, was trying to take advantage of an opportunity, as he shopped for a gold watch. “Gold is rising all the time, so it’s better to buy now, isn’t it?” he said.
© 2024 AFP
