Country’s total gold demand has risen 32% in 12 months.
Turkey is becoming a key market for gold as an investment, as its popularity begins to overtake traditional methods of saving in the country.
A report by Resource Investing News offers that more Turks are preferring to store their money in the form of gold rather than through traditional banking methods.
Last year demand for gold coins and bars rose 99% in the country, while its total gold demand increased about 32%, to 143 tonnes, according to the World Gold Council.
The Istanbul Gold Refinery estimates that individuals have about 5,000 tons of gold valued at $270 billion (£217bn) stored away – money and wealth that has no benefit to the Turkish economy while the government struggles to maintain the country’s deepening deficit.
In reaction to this increase in demand for gold as an investment, Turkish jeweller Atasay is said to have agreed to venture into the “gold banking” realm with two Turkish banks. The initiative will allow members of the public to exchange gold for a a certificate outlining the value of the gold, which is then taken to a bank to have the equivalent amount in cash deposited.
Turkey has long been associated with gold, as both a producer of fine gold jewellery and for its own domestic supply. However while domestic supply peaked in 2009 to 231.8 tonnes, according to the World Gold Council, mine, total supply in 2011 declined to 98.6 tonnes due to the sharp reduction in recycled supply.