During times of war, gold remains a safe haven for individuals.

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The Palais Brongniart stands at the Place de la Bourse in the heart of Paris. In specialized shops, gold bars and coins are selling like hotcakes since the beginning of the war in Ukraine, with some French people feeling the need to secure a portion of their savings in this uncertain period. “It’s to diversify my savings a bit and then, given the situation, to protect the little savings I have…” says Serge, a man in his sixties who came to buy gold in the Bourse district of Paris.

Gold is considered a safe haven: demand increases during crises, such as during the oil shocks, in 2011 with the European debt crisis, or more recently at the beginning of the health crisis. The war in Ukraine is no exception: the price of gold reached its historic high in early March, just over $2,000 per ounce. It has since declined as investor concerns about the war have eased, but remains at high levels.

Interviewed by AFP, the CEO of Loomis FCGS, Cédric Koczor, who sells and stores gold for banks and savers, notes a stronger appetite from individuals compared to “big investors.” “We doubled our sales between February 24 and March 24,” confirms Alessandro Soldati, CEO of Gold Avenue. The increase is “mainly on coins and bars” while larger products like bars “remain quite calm,” says Koczor.

The Monnaie de Paris also observed a 10% increase in its sales of gold coins in March compared to the same period last year. “There is certainly a concern to make it a store of value,” said the CEO of the institution, Marc Schwartz, when announcing its results last week.

Gold attracts in times of crisis because its price is supposed to resist inflation, gain value in the long term, and remain relatively easy to resell. Physical gold, different from “paper gold” which consists of betting on the price of gold on the stock market, can also seem reassuring in the face of the complexity of the dematerialized banking system.

However, investing all of one’s savings in gold remains complicated: it does not yield dividends or interest, and storing it securely can require fees. While some are buying more, the French are not abandoning other savings products, notes Philippe Crevel, director of the Cercle de l’Epargne. “They keep a lot of money in their current accounts, a lot in Livret A accounts, and life insurance continues to set record collections,” he says. For now, he assures that he does not observe a departure from traditional investments since the beginning of the war, but “rather a strengthening.”

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