Number of Czechs investing in gold on rise

Interest in precious metals and stones in the Czech Republic, is reaching new highs, either for personal use, in the form of jewellery, but in the form of bullion as an investment. Czechs this year alone, for example, spent more than three billion crowns on gold bars, even though the price of the precious metal has almost doubled over the last two years.

Photo: Jakub Krechowicz, Stock.XCHNG

You know the saying: not all that glitters is gold, only in this case it is: more than three billion crowns worth. That’s how much Czechs spent on gold bars in 2012, even though the price of the precious metal has only risen. At least one reason? Besides personal fascination with the precious metal’s shiny and untarnishable appearance, gold remains a solid investment. Forbes magazine has described it as “the only real hedge” in uncertain financial times, and its value has consistently gone up. Libor Křapka, the Business Manager for Safina explains how the year in the Czech Republic went:

“Our firm this year registered a record amount of sales in investment gold. By our estimate before the year is over we will have sold 600 kilograms. That represents a jump between 20 and 30 percent compared to last year.”

Gold has seen a renewed and growing interest ever since 2008 coinciding with the start of the global financial crisis. Six years the price of a gram of gold was the equivalent of around 300 crowns; today it is over 1,000 (the equivalent of more than 53 US dollars). The sale of diamonds is also on the rise, and there too the value has gone up. Diamonds specialist for D.I.C. Luboš Říha:

Photo: Kristýna Maková, ČRo 7 - Radio Prague

“You can say that we have seen an increase in the sale of diamonds – worth hundreds of thousands of crowns – of about four to five percent.”

And that is one reason why Prague is becoming an increasingly attractive location for international jewellers: four of five top international firms have already opened branches in the Czech capital. Michael Kowalski of Tiffany and Co. told Czech TV why:

“Prague was a very easy decision for us. Obviously it is one of the great cultural and artistic centres in Europe. We also believe that there is a wealth of customers here.”