Gold producing countries are ramping up production following the rise in prices in the past few years, according to Gold Made Simple. One of the main factors that influences the price of gold is supply and demand. When demand for gold exceeds supply, which is happening at present, the price of gold goes up and vice versa
With the current global economic crisis in full swing, demand for gold bullion remains strong. Investors are losing confidence in traditional investments, such as, stocks, shares and paper currencies. This is due to the threat of inflation, uncertainties over sovereign debts of the euro nations, especially Greece, and the fluctuating US dollar. As a reaction to this investors are turning to gold as a safe haven for assets.
Many of the top gold producing countries are increasing gold production to meet the global demands for gold. China, at present, is the world's leading producer of gold. Recently gold has been discovered in China estimated to be worth over £404 million. Gold output in China has increased by 70% which has knocked South Africa off the top spot which it has held since 1905. Gold has always played a vital role in the South African economy. However, it has recently been affected by the Rand losing value and the offer of cheaper gold, to buyers, from Russia and Australia.
Gold mining is big business at the moment as demand exceeds supply. Gold companies have jumped on the gold bandwagon and are investing heavily in new projects. Countries like Australia, China, Canada and Hong Kong are developing new mines in mineral rich countries, such as, South America, China and Mongolia. Canadian miners Ivanhoe Mines and Hong Kong based Mining International are developing new projects in Mongolia in order to exploit the country's gold bullion reserves, which had previously been inaccessible due to governmental red tape.
As investors try to ride out the storm of the current global economic crisis they are buying gold as the apparent safe option for long term investments. Last year over 165,000 tonnes of gold were mined globally and that figure is expected to rise considerably this year. Gold mining companies recognise there is money to be made and are rising to the challenge, Gold Made Simple said in an analysis. (PRWeb)