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Gold in technology - a brighter outlook?

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NEW YORK (Scrap Register): After years of thrifting, tech hardware companies are taking renewed interest in gold, according to a new report from the World Gold Council (WGC), which sees the sector as a growing source of demand for the yellow metal.

“Replacement and thrifting combined account for most of the 71-ton fall in electronics demand from 2010-2016, but we believe the major fall in demand for gold in the electronics sector may be behind us,” the researchers at WGC said in a report Tuesday. “There is no doubting that technology is an important source of gold demand.”

The analysts said that gold demand from the tech sector has seen consistent growth since the fourth quarter of 2016. Gold’s physical properties, highly conductive, pliable, and noncorrosive, make it an ideal component for many electronic applications, said the gold council.

The council noted that last year, more gold was used in technical applications than either platinum or palladium, two precious metals that are more known for their industrial demand.

In particular, the researcher said that they see strong gold demand coming from smartphones and microchip makers. The council estimates that each smartphone contained between $1 and 1.50 of gold, but this could grow as phones become more complicated.

“The last quarter of 2017 has been a busy period for smartphone manufacturers,” the analysts said. “A new generation of smartphones means a new generation of electronics and chips. Given the complexity of some of these features making an appearance on these devices, we expect that many of them will contain more gold than previous iterations. Features such as facial recognition ID, wireless charging and infrared sensors all require advance semiconductors.”

Looking ahead, the WGC said that the auto sector could see higher gold demand in the future as hybrid and fully electric vehicles gain in popularity. The researchers noted that these new vehicles will need a wide-range of microchips.

“Applications are broad, ranging from engine and breaking-system management through to in-car connectivity and entertainment systems, which each requiring a range of high-end electronic components.”

Finally, the emergence of the clean energy sector offers numerous opportunities for gold demand to grow. According to the report, “the link between solar applications and gold has strengthened in recent years. Gold nanoparticles have been incorporated in a variety of solar cells to harvest more of the sun’s energy and convert it into electricity.”

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