The 1 oz. gold Krugerrand (or Krugerand as it is easily misspelled) was first minted in 1967 with a mission to make gold bullion ownership affordable for the average-income person.
This was a noble plan and smart move by the South Africans since they are one of the largest gold producers in the world. After all, who could blame them for capitalizing on their natural gold resources?
Fortunately the Krugerrand succeeded in its mission much the same way the Ford Model T blazed the trail for the modern automobile. Affordability was the cornerstone that made both products wildly successful.
The Krugerrand has never had a face value in any denomination. The absence of a rand face value ensures that its worth will always be determined by a changing gold price ... not some fixed currency amount.
Krugerrand gold coin prices are mainly set by the spot gold price for one troy ounce of gold bullion.
The Krugerrand is an alloy since it also includes a base metal to make it more durable. Its gold purity is 22-karat (91.67% gold and 8.33% copper).
Artwork and Proof Coins
A portrait of Paul Kruger is displayed on the obverse (heads) side of Krugerrand gold coins. The reverse (tails) side features an antelope.
Paul Kruger was the last elected President of the South African Republic before it was annexed by the British Empire at the turn of the 20th century.
The Krugerrand is one of his namesakes ... at least the first half of it. South Africa's currency “rand” completes the name.
Proof Krugerrand gold coins are produced in limited numbers by the South African Mint. Special minting practices are employed by the mint to produce unique features on these collectible coins.
Due to their rarity, proof coins are usually more expensive than standard bullion issue coins.
The Main Thing
Although one may consider the art plain, the main attraction of Krugerrand gold coins is their lower gold bullion cost. They have remained a good buy over the years due to their large production numbers.
So high availability and backing by the South African Mint make the Krugerrand a solid but economical choice -- especially if you want to load up on 1 oz. gold bullion coins.
By 1980 the Krugerrand accounted for the vast majority of gold bullion coins sold. As a result the South Africans expanded their product offerings to include fractional coins in ½ oz., ¼ oz. and 1/10 oz. gold weights.
These smaller Krugerrand gold coins compete with 22-karat American Eagle Gold Bullion Coins which are also available in the same fractional weights.
I raise this point about American Eagle Gold Coins so you can make an apples-to-apples comparison between these two options before you buy any fractional coins.
1⁄10 oz. American Eagle Gold Bullion Coins
History Of The Gold Krugerrand
I have already given you a couple key dates … 1967 and 1980. The former is when the first 1 oz. gold Krugerrand was issued. And minting of fractional Krugerrand gold coins began in 1980.
It was the unpopularity of the South African government and its racial segregationist practices (apartheid) that gave rise to other nationally-issued gold bullion coins.
My country is a good example. In October 1985 President Reagan issued Executive Order 12532 which banned importing the gold Krugerrand into the US.
President Reagan further ordered the Treasury Department to determine if the creation of a US gold coin to replace the Krugerrand was feasible.
The President’s actions - and passing of the 1985 Gold Bullion Coin Act by Congress - resulted in the issuance of American Eagle Gold Bullion Coins during 1986.
In 1994 sanctions against South Africa ended when Nelson Mandela and the African National Congress were elected.
The Mission Continues
It's been decades now since the gold Krugerrand was first minted. Nevertheless the South Africans continue to fulfill their commission by producing quality gold bullion coins for everyone.
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