Fear that the dramatic fall in scrap gold and silver prices last week would hit the antiques market appear to have been allayed.
Early indications suggest that the largest
fall in the bullion price for 30 years on April 15-16 has not
affected trade too dramatically, as the drop off was largely seen
as a market correction after three years of historically high
Dealers reported little impact so far
despite the 12% fall in gold and the 13.5% fall in silver recorded
before the market briefly rallied at the end of last week. This is
possibly because scrap values for many routine pieces of gold
jewellery and lower-quality silver remain above their current worth
Brighton-based precious metals dealer
Michael Bloomstein said that he was still taking in roughly the
same volume of items destined for melt as before, including objects
such as heavy jewellery, Victorian and 20th century tea services,
flatware, salvers, holloware and other pieces of ordinary domestic
He also reported that there was still strong
demand for investment gold (such as sovereigns and other coins) due
to the continuing economic uncertainty and low interest rates
offered by banks.
The fall in the price of precious metals on
international markets has widely been attributed to the
announcement that Cyprus's plan to sell most of its gold reserves
might prompt other weak eurozone economies with much larger
reserves, such as Italy, Spain and Portugal, to follow suit.
Such a vast supply of gold coming onto the
market would be bound to depress prices significantly.
Other contributing factors are thought to be
the belief that the US Federal Reserve will soon end its
quantitative easing programme and the recent imposition of an
import tax in India, the world's largest buyer of gold.
There has also been a slight decline in the
rate of China's economic growth that saw drop-offs in wider
commodity and share markets.