Gold behaves "more like a currency than a commodity," according to Anthony Bolton, the legendary investor who manages the China Special Situations investment trust for Fidelity.
In an interview with The Telegraph, Bolton underscored gold's value, noting it has distinguished itself as the Western world goes through a slow-moving growth period. He pointed out that the U.S. dollar has not been as strong in recent years, though dollars serve a vital function as the commodity market's international language.
"Commodities are measured in U.S. dollars and the U.S. dollar has been weak for the past couple of years," Bolton told the U.K. publication. "If commodities were measured in a stronger currency, the recent rallies might have been different."
"Gold is more like a currency than a commodity," he said.
Western economies are currently "anemic", Bolton believes, and he doubts the strength of emerging market growth will be a driver of commodities.
Gold remains a safe investment, he said, as evidenced by Chinese investors' preference for gold – rather than American bonds.
"Almost every country has a big budget deficit at the moment so it is in their favor to see their currency depreciate," he said. "Countries hold gold as a protection against that."
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