Traders said the slump in world gold prices was unlikely to hurt people's belief in the yellow metal. Rather, it is a great opportunity to stack up more gold, especially as their currencies have recovered over the past few months, they said.

``Premiums for kilobars have gone up quite a bit because of the sudden demand. It's gone up about 20 per cent...this week,'' a gold trader in Singapore said.

Quotes for the Singapore premium over the London spot price varied widely but several were around 100 cents an ounce.

``If you had the experience that Indonesia had during the crisis, you definitely know the value of keeping your wealth in the form of gold,'' he added.

Traders said physical demand had picked up in Asia after the fall in gold prices to 20-year lows of around $256 per ounce on Wednesday, triggered by Britain's first auction of its goldreserves.

Many more buyers are waiting for the price to slide towards $250 or below to cash in on the bargain, especially as their economy has stabilised or started to pick up after two years of trauma, they said.

``Everybody's up for $250. We're going to see more buying at that kind of price,'' a trader said. ``Especially with a five-dollar drop in a day, they're convinced they are going to see $250 soon.''

Regional manager for finance, administration and planning at the World Gold Council, Koh Tong Huat said: ``This is the fourth quarter that showed continued growth in gold demand. At the rate we are going, we should reach pre-crisis levels soon.''

In Indonesia, Thailand, Malaysia or China, where many still lived in rural areas far away from any banks, traders said that people were unlikely to change their habit of buying gold to hedge against difficult times ahead.

They added the Asian crisis had only proved how wise their grandfathers had been in buying gold chains, instead of turning to thebanks, many of which had gone bankrupt over the past two years. ``A vast majority still live in rural areas. Banks have not proven especially reliable to them,'' one trader said.