The war in the Ukraine and inflation have boosted the demand for gold in Germany.

Above all, physical gold in the form of bars is more in demand in Germany than in many other countries.

Almost every third private gold investor in Germany has changed their investment strategy in the face of the Ukraine war: Many have even increased the proportion of gold in their assets or are increasingly investing in cash or stocks.

Fixed-term deposit accounts and money market accounts, on the other hand, have continued to lose popularity.

Christian Siedenbiedel

Editor in Business.

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This is the result of the annual gold market survey by the precious metal group Heraeus from Hanau, which the FAZ is exclusively available in advance.

Those surveyed name skepticism about general economic developments and concern about continued high inflation as the most important motives.

52 percent expect the economy to shrink in the next twelve months – 48 percent expect prices to “rise” and 46 percent to “rise sharply”.

Accordingly, 32 percent of those surveyed changed their investment strategy during the Ukraine war.

Gold in particular benefited from these shifts: among this group, 73 percent are increasingly investing in the precious metal, 36 percent are increasingly investing in cash and 29 percent in stocks.

"In May, inflation in Germany was 7.9 percent, the highest it was almost 50 years ago - concerns about further sharp price increases as well as fears of recession and war are likely to drive the price of gold," said Alexander Zumpfe, precious metals dealer at Heraeus.

The price of gold had fluctuated in recent months: Uncertainty and inflation had boosted it – expectations of rising interest rates and a strong dollar, at least for a long time, had dampened it.

Gold was trading at a good $1,850 per troy ounce (31.1 grams) on Thursday.

Global gold demand rose 34 percent to 1,234 tons in the first quarter - Germany stood out with strong demand for physical gold, i.e. bars and coins, at 47.2 tons.

The result of the gold market survey corresponds to the observations of precious metal traders such as Pro Aurum in Munich and the industry organization World Gold Council: According to them, the gold price and the demand for securities on gold on the international markets are suffering from the emerging interest rate turnaround.

In Germany, however, the demand from private investors for physical gold is so strong that delivery times have been extended at times.

For its Barometer 2250, Heraeus interviewed private investors from Germany who were more interested in gold and who had at least shown some interest in gold.

81 percent said they currently own gold, 59 percent stocks, 34 percent real estate, 16 percent life insurance, 15 percent time deposits and 7 percent bonds.

Gold accounted for less than 10 percent of wealth for most;

only a small part focussed on gold.

Gold investors often men over 50

The study also teaches a little bit about typical German gold investors.

Men and the age groups over 50 were disproportionately represented among the “investors with an affinity for gold”.

Most of them own bars: 65 percent stated that they hold gold in this form.

48 percent said they had coins.

Gold jewelery came to 13 percent, gold savings plans and gold securities each to 11 percent.

A relatively large number of investors store their gold at home.

In the survey, 24 percent said they did.

And this despite the fact that there have always been crimes in which people have had their gold stolen or stolen from their homes.

The police even reported a case where an elderly lady had all the walls of her home pried open by burglars while she was at the opera - because she had told an opera friend that she kept her gold bars there.

Gold investors are very concerned about inflation

Inflation seems to be a key reason why investors are betting on gold right now.

In the survey, a large majority said that gold means "value preservation", "safe haven" or "inflation protection".

Only 11 percent of private investors rely primarily on a return through an increase in value.

This may be an important difference to the professional investors in the international gold securities market and explains slightly different cycles.

Sustainability is also an issue for gold investors

The authors of the study also report that many gold investors are more interested in the topic of sustainability.

"It is noticeable that the topic is gaining in importance," said Zumpfe.

43 percent call the topic important, 14 percent very important.

The CO2 footprint of gold is therefore important to every third respondent, seven percent very important.

54 percent would even be willing to pay more for CO2-neutral gold.

The underlying reason is that there is a debate as to whether a second, higher gold price should be established for gold that is mined under more sustainable conditions.

Gold dealers like Heraeus had discussed it.