South Africans cashing in Krugerrands – for R47,000 a coin

Many South Africans are selling their Krugerrands to take advantage of the record-high gold price, with the coin now going for over R47,000.

This is according to South African Gold Coin Exchange and the Scoin Shop CEO Rael Demby, who told The Money Show that they have been trading in high volumes.

He said family estates and individuals who have collected these over 20 to 30 years have finally decided to cash in on their investments due to the high gold price.

The gold price has seen a massive boost over the past two years as investors look to the safe haven asset to protect their money from inflation, high interest rates and global uncertainty.

The World Gold Council’s Q1 2024 Gold Demand Trends report revealed that total global gold demand was up 3% year-on-year to 1,238t, marking the strongest first quarter since 2016. 

In terms of investment demand, bar and coin investment increased 3% year-on-year, remaining steady at the same levels from Q4 2023 at 312 tonnes.

World Gold Council senior markets analyst Louise Street explained that since March, the gold price has climbed to all-time highs, despite traditional headwinds of a strong US dollar and interest rates that are proving to be ‘higher for longer’.

“A number of factors are behind the recent surge, including heightened geopolitical risk and ongoing macroeconomic uncertainty driving safe-haven demand for gold,” she said. 

“In addition, the continued and resolute demand from central banks, strong OTC investment and increased net buying in the derivatives market have all contributed to the higher price of gold.”

“Based on its recent performance, 2024 is likely to produce a much stronger return for gold than we anticipated at the beginning of the year.”

Over the past three years, the gold spot price has increased from $1,830 in May 2021 to around $2,300 in May 2024.

Demby said that this massive surge in the gold price has pushed investors to cash in and many others to buy, with Krugerrands, in particular, seeing a boost over recent months.

He said gold has proven time and again that it is an effective investment to “protect you and money when things get rocky”.

Krugerrands, in particular, have held a special place in the country’s gold market and skyrocketed in value since they were first released.

Demby said the first Krugerrand was around R27 in 1967 but the coin is now trading at over R47,000.