Growing lineups mix with affordability challenges as Winnipeg retailers navigate surge in gold prices

With the becalm upsurge in the damage of atomic number 79, thomas more customers are lining up to sell off or invest in the precious metal at some Winnipeg retailers, as those businesses are also wrestling with alternatives to make the karats more attainable. 

"People are selling, people are trading, people are even pawning if they're in a pinch and they need money." 

The market price of gold closed at about US $4,600 per troy ounce — the measurement used when weighing precious metals — on Friday, Paul said. 

Even though it dipped slightly before last week, the price for the commodity has progressively increased in the last six months.

After years of gradual growth, gold hit a record-high in October, peaking above US $4,000 per troy ounce. The commodity has mostly surged in value since then with a five per cent increase in January alone, the Associated Press reported on Friday.

The soaring prices means the value of products at Golden Hand Jewellery has also grown — but that has come with challenges, including finding new alternatives to offer affordable options to customers buying at a time of rising inventory prices. 

"It's very hard for us to keep on engaging customers to come in and feel that they're getting amazing deals," said Golden Hand Jewellery co-owner Dorota Szurlej. 

The business is trying to increase sales by offering some gold products on clearance with hefty discounts while bringing new items into inventory that resemble the precious metal but are actually made of yellow silver and can be sold at a fraction of the cost. 

Appealing to younger audiences on social media, bringing in NHL licensed jewellery and original designs are also some alternatives to keep sales going, Dorota said. 

"We are also being more creative when people come in to sell or pawn their gold, so how can we reuse that gold? … we can either make memory pendants or remake customers' gold into new sentimental items," she said.

Winnipeg gold store gets creative as prices soar

University of Manitoba Professor Barry Prentice said the sale value of the precious metal will continue to be determined by its supply and demand.

"It's worth whatever people are willing to pay for it, that's essentially what it comes down to," he said. 

The recent growth comes amid large government institutions moving their economic reserves away from the U.S. Dollar, trading it for gold, he says.

"Governments have less confidence in the US and in some cases, like China, very much would like to reduce their exposure to the US dollar," he said. 

"Currency markets, I think are [also] in a certain amount of disarray … we see these cryptocurrencies now coming along. We see a lot of inflation and I think that uncertainty is pushing some of this."

With less supply of gold but growing demand, gold's price has been surging. While the jump has put a pressure on markets, it is welcoming news for mines in Canada and an opportunity for people selling their jewellery. 

"They've looked at this and said, 'My goodness the prices kept going up and up and up' — it's the old waiting for the ultimate dollar," Prentice said.

At Winnipeg's Gatewest Coin Ltd. There have been more customers bringing in the scrap gold to bask in the high prices and sell it, according to Jasmine Allen, the store's vice president. 

But there have also been more clients interested in purchasing gold not necessarily to wear it but as an investment. 

"There's so much geopolitical instability. Precious metals are typically used as a safe haven," she said. 

While she has worked through other peaks in the price of gold, like in 2012 or during the COVID-19 pandemic, Allen said she has seen nothing like this before.

"It's not uncommon for us to right now have lineups out the door," she said. 

With business booming Allen, said they had to redo the storefront to have more staff and computers to assist with customers. 

"On the average day we were used to seeing between 10 and 15 [customers]. Current times, especially over, especially over the last couple of months, we're seeing 30 to 40," Allen said. 

It is difficult to say how much the price of gold will fluctuate in the short term, also because the value of the precious metal in the country leverages the exchange rate between U.S. And Canadian dollars as well. 

For now customers are leaving the store with surprises in hand, Allen said. 

"Coming in you know they're expecting maybe a few hundred dollars and they're leaving with maybe $800," Allen said. "It's not unusual for us to have people come back a week or two in a row saying 'I found more.'"

High prices leading to more customers, says Winnipeg gold buyer

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