The broad investment community is beginning to view gold as the world’s ultimate store of value.

gold prices surged to an 18-year high in US dollar terms, mainly on the
back of the precious metal’s appeal as a safe haven in times of
economic uncertainty. Investors have become increasingly concerned over
the impact of high oil prices on US economic growth and global
inflation. The recent hurricanes in the US caused further angst as
investors began to assess the inflationary impact of the rebuilding
effort and resultant higher budget deficits.

While gold surged to new highs, US equity markets were in retreat. All
the major indices in the US are currently showing losses for the 2005
calendar year.

the early part of gold’s bull market, the focus has been squarely on
the yellow metal’s performance relative to the US dollar. However, the
fact that gold is now rising in value against other currencies is very
positive in that we believe the bull market is moving into a new phase.
Early in October, prices reached a 12-year high in Swiss francs, a
14-year high in yen, and a 9-year high in sterling. In Australian
dollar terms, gold has risen from A$560 an ounce in early August to
around A$635.

In our opinion this is a clear sign that the bull market in gold is gaining wider acceptance.

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Peter Fray
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