Tags: Deutsche | Bank | Gold | Vault

FT: Deutsche Bank to Open Gold Vault in London

Tuesday, 20 Mar 2012 07:17 AM

Deutsche Bank is stocking up on gold, literally.

The global financial institution will open a new precious metals vault in London in 2013 to get in on rising demand for physical gold and silver, the Financial Times reports.

Gold has become a hot commodity in recent years, made popular as a hedge against weakening paper currencies.

Plus physical demand for gold in countries like China and India has been heavy as well, as those economies see their middle and upper classes grow.

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Investment in gold via exchange-traded funds backed by physical precious metals has been a boon for operators of precious metals vaults, the Financial Times adds, and London has become the hub to operate those vaults.

"We know that clients are looking to diversify where they place their physical holdings and that they value Deutsche Bank's reliability," says Raymond Key, global head of metals trading at Deutsche, adding the vault would position the bank to "quickly become a leading metals clearing and custody house."

Demand for physical gold has been so hot in India that the government hiked import duties on the precious metal to help narrow its current account deficit.

"The import of gold of such magnitude strains balance of payments and affects exchange rate of rupee through impacting supply-demand balance of foreign exchange," says Finance Minister Pranab Mukherjee, according to the Times of India.

Exchange-traded funds hold a record 80.3 million ounces of gold worth $133 billion, according to UBS, the Financial Times adds.

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2012-17-20
Tuesday, 20 Mar 2012 07:17 AM
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