April 8 Institutional investor George Soros said
gold has been destroyed as a safe-haven asset, but expects
continued central bank buying to support prices, the South China
Morning Post reported.
"Gold was destroyed as a safe haven, proved to be unsafe.
Because of the disappointment, most people are reducing their
holdings of gold," Soros told the newspaper in an interview
published at the weekend.
"But the central banks will continue to buy them, so I don't
expect gold to go down. If you have the prospect of a crisis,
you will have occasional flurries or jumps. So gold is very
volatile on a day-to-day basis, no trend on a longer-term
Soros, who called gold "the ultimate bubble" in 2011,
slashed his position in the world's largest gold-backed
exchange-traded fund, SPDR Gold Trust, by more than half
to 600,000 shares in the fourth quarter of 2012 from 1.32
million in the third quarter.
The price of spot gold has fallen nearly 6 percent so
far in 2013, after a 12-year rally, as investors searched for
better investment returns elsewhere including equities. In
contrast to gold, the S&P 500 stock index is up almost 9
percent this year.
On Monday, gold stood at $1,578 an ounce, regaining some
ground after hitting a 10-month low of $1,539.74 last week.
Soros said gold has "disappointed the public, because it is
meant to be the ultimate safe haven."
"But when the euro was close to collapsing in the last year,
actually gold went down, because if people needed to sell
something, they could sell gold...So gold went down together
with everything else," he was quoted as saying by the newspaper.