Gold Sovereign Shortage Strikes U.K.

The Royal Mint of the United Kingdom has announced that it has exhausted its supplies of 2014 Sovereign gold coins as bargain hunters have taken advantage of the lowest gold prices in six months. After falling more than 26% in 2013 in the largest annual price decline in over 30 years gold has become extremely undervalued in the eyes of many Western investors, leading to shortages and sell-outs of many types of gold coins.

In 2013 the U.S. Mint experienced a severe shortage of gold planchets, or blanks, from which gold coins are minted. In just the last few years the U.S. Mint has been forced to ration or cease sales of at least three different gold coins, and many analysts believe that falling gold prices are directly responsible.

After climbing to a record $1900 per ounce in 2011 the gold spot price has taken a beating due to Fed policies and surges in stock indices. Despite the apparently improving U.S. economy many household investors believe that gold will be their saving grace if the Federal Reserve is unable to effectively manage inflation.

While some British investors may be inconvenienced by the lack of available 2014 Sovereign gold coins the majority of U.S. investors will not be affected, as the Sovereign is rarely targeted by American investors due to its relatively high premium for an item classified as bullion by U.S. investment regulations. Sovereigns minted by the U.K. Royal Mint were first produced in 1817 and are widely available on the secondhand market in both the United States and England.

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