Fear and panic are gold's aphrodisiacs

Analysts reckon ongoing fears over the global economic situation will lead to a continuing demand for gold in the second half of the year.

LONDON (Commodity Online) - 

Panic and fears over the future of US and European economies have become the best aphrodisiacs for gold, which has been in an uncertain zone for the past few weeks.

Even though reports on European banks and US housing sales and the not-so-bad report on Portugal have caused gold prices to decline as safe haven sales fell, ongoing fears over sovereign government bonds, debt monetization and currency debasement will lead to an escalation of demand for physical gold and coins in the second-half of 2010.

A new report said ongoing pressure on sovereign debt markets, combined with persistent concerns over private sector credit contraction, will raise the spectre of debt monetization repeatedly over the next few years......

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