by Jayna Rana for thisismoney.co.uk
Royal Mint saw a 510% surge in gold sales in the run-up to Christmas with more millennial customers buying in
Millennials are increasingly looking at gold for investment opportunities, according to the UK’s coin producer, The Royal Mint, The Government-owned company revealed the number of customers aged between 22 and 37 increased by 32 per cent in 2020, as the coronavirus pandemic put precious metals under the spotlight.
Gold was a firm favourite, with the sale of 1g and 5g bars increasing by 53 per cent in November and December compared to the year before.
Turbulence in 2020, caused by the pandemic, saw the popularity of both physical and digital gold increase, an asset which is often thought of as a ‘safe haven’ during times of economic crisis.
During November and December, overall sales of gold rose by 510 per cent, year-on-year.
The Royal Mint said it welcomed thousands of new customers to its precious metals division.
This included those making purchases in digital form rather than taking ownership of physical assets.
Platforms such as BullionVault, The Pure Gold Company and the Mint’s own DigiGold, have made it easier to buy precious metals for this reason.
However physical gold proved just as popular and in the last quarter of 2020, the Mint introduced special edition 1g and 5g gold bars for Diwali and Christmas, which contributed to significant growth as consumers sought out investment gifts.
Andrew Dickey, divisional director of precious metals, said: ‘Gold continued to shine in the last quarter of 2020 as people looked to precious metals for safe haven investments, but also for savvy Christmas gifts.
‘The Royal Mint has been making it easier to access precious metals online, thanks to the growth of our digital investment products such as DigiGold and Little Treasures (a gold-backed savings account for children).
‘As we go into 2021, various fiscal and monetary policies – both of which are traditional drivers of gold demand – will begin to unfold in an attempt to support the recovery of the global economy.
‘With this in mind, we’re expecting demand for our precious metal products to continue to shine.’
The price of gold started 2020 at around $1,550 an ounce. This surged past $2,000 by July before tailing off for the rest of the year, ending December at around the $1,900 mark.
Profit boost for The Mint?
Traditionally known for making coins, The Royal Mint has grown rapidly into the precious metals market over recent years.
It is now the primary producer of bullion coins in the UK, as well as offering a range of digital investment platforms which enable investors to buy and sell fractional gold without taking custody of the metal.
In the financial year 2018-19, it made £3.7million in profit from precious metals – its gold, silver and platinum investment products, a 54 per cent increase on the previous year’s £2.4million.
It is likely that this figure will have grown in the 2019-20 financial year, which is due to be published in the coming weeks.
It said in the last annual report that it has ‘clear plans in place to contribute to the growth of the precious metals market in the UK and overseas and then to grow our share of the market.’
It added: ‘Our aim is to become the leading precious metals solution provider for customers who demand trust and authenticity and in turn create sustainable and long-term growth for the business.’
Source: This Is Money