KOTA BARU, Dec 5- Goldsmiths with blowtorches and chisels sit at wooden desks in a backroom workshop in Malaysia as they melt and mold the precious metal into glittery jewelry.
Over the coronavirus pandemic, demand for the safe-haven product has increased and it is not just professional investors who cash in but also small businesses.
This year the Makmur Gold company, which is located in the northern state of Kelantan and mainly produces jewellery, enjoyed brisk business even as the economy of the Southeast Asian nation plunged into recession.
Our revenues were much better during Covid,” company director Muhammad Nur Hisyam Che Mahmood told AFP, “We’ve seen strong developments.
As the pandemic accelerated and financial markets crashed, gold soared this year, reaching a peak above US$2,000 (RM8,120) an ounce in August, although it has fallen back to around US$1,800 since then.
Over the past eight months, Makmur Gold posted strong sales of about RM80 million as buyers sought to park their cash somewhere healthy.
From its four stores as well as online, the company offers merchandise directly to clients, selling products ranging from bracelets and rings to small gold bars.
Until being melted down and fashioned into new items, much of its gold is sourced in the form of jewellery from a limited number of suppliers in the country or purchased second-hand from consumers.
As authorities allowed companies to reopen after a six-week virus lockdown, Malaysians began rushing to purchase gold in May, said Steven Siow, president of the Federation of Malaysian Goldsmiths and Jewellers Associations.
After not spending much for a while, people had additional cash, and because of a six-month government moratorium on repaying loans aimed at stimulating the economy, gold stores doubled or even tripled their sales, he said.
The gold price has dropped as hopes rise that vaccines will be carried out soon, but analysts believe that the global economy is facing a bumpy recovery and that the precious metal will remain a safe bet for some time.