Central Bank Demand Driving Gold Higher: Randgold

Central Banks from emerging market nations are seeing gold as a safe haven against the volatility of the global economy and are keeping prices and demand stable, Mark Bristow, CEO at Randgold Resources, told CNBC.

“The supply side of the supply-demand equation is very tight. There is a growing demand side from the increase in jewelry off-take in central Asia, but also the central banks starting to buy gold. These are the emerging markets central banks, not the G20 central banks,” Bristow said.

He added that in an increasingly uncertain world, central banks are using gold as an important way to balance foreign exchange risk and was a way to shore up their risk strategy.

An important driver in the price of gold has been consumer demand, particularly in India and China, where it is prized in religious and cultural ceremonies.

Bristow added that those consumers would continue to fuel demand because of the cultural significance of the precious metal and demand from the burgeoning middle class.

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