Brexit bullion: Fear of no-deal triggers Irish gold rush

Examples of gold bullion are on show at Merrion vaults in Dublin on January 7, 2019. In a vault under the streets of Dublin a pot of gold owned by anxious investors is growing every day Britain edges closer to leaving the EU without a deal. (AFP)
Updated 19 January 2019
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Brexit bullion: Fear of no-deal triggers Irish gold rush

DUBLIN: In a vault under the streets of Dublin a pot of gold owned by anxious investors is growing every day Britain edges closer to leaving the EU without a deal.
“They’re worried about a significant devaluation in sterling if there’s a hard Brexit,” said Seamus Fahy.
Fahy is co-founder of Merrion Vaults, a gold brokerage and safe deposit facility in the center of the Irish capital.
Over 2018 — as the prospect of Britain crashing out of the EU turned from a scare story into a very real prospect — he has seen a 70 percent rise in clients from the British province of Northern Ireland.
“Customers are taking money — physical money — out of the bank and they’re buying gold bullion with us to store it, and it’s a hedge,” Fahy explained.
There is no equivalent facility in Northern Ireland.
With the border only an hour away it is no long trip to secure peace of mind as Britain risks a split with the EU critics are branding a “cliff-edge Brexit.”
Set in the basement of an unassuming grey office block, Merrion Vaults does not advertise its presence to passersby, marked only with a coy plaque reading “Merrion Private.”
Down an elevator, past a manned security booth and a fingerprint scanner — as well as a hefty metal safe door — is a caged vault, ranked with 3,000 double-locked deposit boxes.
Their full contents are known only to clients. But Fahy knows that inside many are glimmering stashes of gold.
Numerous customers have spent over £500,000 (560,000 euros) on their precious nest eggs.
The most popular items are one ounce (30 gram) gold bars and coins: handsomely polished South African Krugerrands, Canadian Maple Leafs and British Britannias worth in the region of £1,100 (1,200 euros) each.
They have increased in value by around 10 percent in the past six months, according to Fahy’s ledger.
When news of the 2016 Brexit vote broke, gold surged as sterling plunged to levels not seen since 1985.
The result was a historic 22 percent jump in gold valued in British currency terms.
In December, when British Prime Minister Theresa May pulled the parliamentary vote on her Brexit deal, Fahy also saw a “big uptick” in demand.
Pundits saw that as the most foreboding indication yet of a no-deal Brexit on March 29.
The prospect of the fallout sinking sterling seems to be making investors skittish.
“In times of crisis you always see what’s called this ‘flight to safety’ — so people go into US government bonds, gold bullion, Swiss francs etc.,” said Fahy.
The future status of Northern Ireland — the so-called “Irish backstop” — is at the crux of the Brexit conundrum and has added particular concerns on the island.
“You often see local events driving local demand,” said Alistair Hewitt, head of market intelligence at the World Gold Council.
But Hewitt said that the Brexit gold rush may have already peaked in the rest of Britain, with “an upsurge of activity” around the vote itself.
“Over the course of the past two years that’s probably petered out a little bit. I think lots of investors have probably suffered a bit of Brexit fatigue.”


South Korea: Japan dispute to hit global technology companies

Updated 17 July 2019
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South Korea: Japan dispute to hit global technology companies

  • Japan’s steps are inconsistent with World Trade Organization principles, South Korean government source says

SEOUL: Export curbs Japan imposed in its dispute with South Korea will adversely affect global technology companies and hurt the operations of tech giant Samsung in the Texas state capital of Austin, a South Korean government source said on Wednesday.
Japan’s steps are inconsistent with World Trade Organization principles, but South Korea wants to resolve the dispute through dialogue, the source told reporters in Seoul, speaking on the condition of anonymity in order to discuss negotiations.
If Japan goes so far as to drop South Korea from its “white list” of countries with minimum trade restrictions, it would cause a “tremendous amount of problems,” the source added.