The euro, the dollar and the pound have been three of the stronger currencies in the world in recent months which has curtailed gains in precious metals in these currencies. This has not been the case for emerging market currencies many of which have fallen sharply and gold has risen correspondingly in value.
Thus, gold has again acted as a safe haven for millions of investors and savers around the world and protected them from the declining value of fiat currencies.
Gold in Euros - Jan, 2009 to April 17, 2014 - (Thomson Reuters)
This is particularly evident in Ukraine where the economy is nearing collapse and the currency is in free fall. The Hryvnia has been the world’s worst performing currency in 2014.
The charts below gives an indication as to the terrifying magnitude and speed of the recent decline in the value of the currency. Last week alone the currency fell by 7% against gold or gold per ounce has risen from 15,669 hryvnia per ounce at open on Monday to 16,880 hryvnia per ounce at the end of the week.
Gold in Ukrainian Hryvnia (Sharelynx.com)
Year to date, gold in hryvnia has surged by 69% from 9,992 per ounce to 16,880 per ounce or to put it more correctly, Ukraine’s national currency has collapsed by 69% against gold in less than four months.
This has resulted in the cost of food, fuel and basic staples surging for ordinary people in Ukraine.
People are buying gold, silver, other hard tangible and income generating assets.
Once again, the lucky few who own physical gold are being protected from the currency collapse. They are in a position to buy food, water, property, land, businesses and other income generating and life sustaining essentials.
Thereby, once again showing the lack of knowledge and sometimes simple bias of those who claim that gold is not a safe haven and discourage investors from having even a small allocation to gold.
Gold is protecting people and companies in Ukraine today. It will do the same for people and companies in other countries in the coming months and years.
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