Sky-high values see customers rushing to sell and pawn gold

Photographer: Chalinee Thirasupa/Bloomberg

NEW YORK: Investors and metals traders can’t agree on what exactly is behind gold’s recent rally. At King Gold & Pawn in Brooklyn, the customers don’t care. They just want to sell.

For some, sky-high values simply mean it’s a good time to cash in. It’s hard to ignore record prices that climbed above US$2,400 an ounce last week.

For others, it’s a more desperate move to get money for bills and rent. Whatever the need, what’s clear is jewellers and pawn shops are seeing a flood of sellers.

“People are using gold as an ATM they never had,” said Gene Furman, owner of King Gold & Pawn and Empire Gold Buyers.

At Furman’s 5th Avenue store, the number of people coming in to sell and pawn gold jewellery is more than three times above normal levels since prices started to rally in late February.

Among them is Branden Sabino, a 30-year-old information technology specialist, who sold a gold necklace and a gold ring last week.

“Prices are high, and I need cash,” he said, adding that with the cost of rent, groceries and car insurance rising, he doesn’t have any savings.

The speed and magnitude of gold’s ascent is astonishing, Since the 2024 low in mid-February, it has rallied 17%. Investors typically seek safety in gold for fear of political, economic and financial crises.

Escalating tensions in the Middle East, a war in Ukraine and an upcoming US election are now underlining its traditional role as a haven asset once again.

At the same time, some investors have been betting that inflation may stick higher in the long run, underpinning gold’s run.

As experts argue over the causes, economic, political or technical, for Mirsa Vijil, it is much simpler: “Gold is high.”

At King Gold, the 55-year-old was pawning a bracelet for gas bills. It was her first time using such a service, but she said she’ll do it again if needed.

Changing fashions, as well as financial needs, mean there’s often less reason now to pass on old pieces to relatives. And current prices are a tempting offer. — Bloomberg