Gold price fall ‘is puzzling’

<p>The fall in the value of gold has been described as puzzling.</p>

Gold has been dropping over the course of the year and the fall in the value of the precious metal in the last few months has been described as "puzzling".

Mike Turner, head of global strategy and asset allocation at Aberdeen Asset Management, stated gold would usually be seen as a "safe haven" with the world's economy in the state it currently lies in.

However, he pointed out factors such as the Cyprus government admitting recently it is considering selling off its gold reserves have weighed heavily on the commodity.

"But perhaps more important is the fact that the yellow metal has morphed in recent years, from being seen purely as a safe haven to merely another risk asset and now trades more like other commodities," said Mr Turner.

He pointed out that gold remains one of the best insurance policies against inflation and investors should not forget this in the coming weeks and months.

Speaking to the Market Oracle recently, ABN Amro commodities strategist Georgette Boele stated she believes the demise of gold is only in its early stages.

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