By Kitco News
Tuesday July 05, 2016 15:12
(Kitco News) - The fallout of Britain’s referendum to leave the European Union less than two weeks ago continues to be felt around the globe as consumers buy safe-haven assets like gold.
In Japan, the asset of choice has been physical bullion.
Tuesday, Japanese media reported that gold retailer Tanaka Kikinzoku Kogyo K.K has seen purchases of its gold bullion products increase 1.8% since the Brexit vote passed.
According to Japanese Newspaper Yomiuri Shimbun, retail gold purchases in the last week is comparable to demand seen in 2008 following Lehman Brother’s collapse, which led to the global financial crisis, or in 2014 when the Japanese government raised the consumption tax rate to 8%.
Another major Japanese department store chain, Daimaru Matsuzakaya Department Stores Co., has also reported strong gold demand as it has sold ¥300 million worth of gold items from June 29 to July 5. The company estimated that gold purchases doubled compared to a similar sale that was held in November.
The Yomiuri Shimbun quoted a 69-year-old homemaker from Tokyo, who said: “Because I’m anxious about future economic conditions, I chose to own a solid asset.”
Interestingly, Japan’s strong gold demand has come at a time of renewed currency strength, giving consumers a good bang for their yen. The U.S. dollar is trading at multi-year lows against the yen falling Tuesday to 101.52.
According to Kitco.com gold currency charts, out of the major global currencies, gold is only down against the yen, last trading down 0.66% on the day at ¥137,583.30 an ounce.