THE price of gold in Japanese yen has fallen to its lowest level since 1976. Illustrating the extent of the appreciation of the yen, the international gold price was about US$115 in September 1976, when the dollar was trading at about 287 yen, Bank of England statistics showed. The price of gold was about 33,000 yen an ounce, compared with the present price of 32,700 yen an ounce. When gold reached a peak of $850 in January 1980, it was about 200,000 yen an ounce. These statistics show the overvaluation of the yen. In terms of purchasing power parity, the dollar is valued at 155 yen. The mark is only two yen above its post World War II low of 57.80 yen against the Japanese currency. Gold has also proved to be a poor investment for holders of major currencies. In a remarkable bull market, between 1976 and 1980, the gold price soared eightfold to $850 in January 1980. Yet, the dollar was strong until the mid-1980s and gold slid to a low of $281 in February 1985. Since that time, gold has appreciated by 38 per cent in United States dollar terms, an annual compound rate of more than three per cent. Japanese, Swiss, German and other holders who purchased gold with their currencies have experienced hefty capital losses. The statistics illustrate why gold has behaved disappointingly in the past 15 months in the face of the worst currency crisis since the late seventies. When the dollar tumbled under the Carter Administration between 1976 and 1978, gold soared by about 135 per cent to $250. It was strong in terms of all currencies and was regarded as a hedge against dollar weakness. Since the present dollar bear market began at the start of last year, gold fell by one per cent against the dollar, 26 per cent in yen, 23 per cent in Swiss francs and 20 per cent in marks. Investment demand, apart from occasional speculative flurries has been disappointing. Yet, as a commodity, gold is cheap for jewellery and other manufacturers in Japan and Europe, where currencies have appreciated against the dollar. Japanese dealers say demand is strong in Japan, both for fabrication and investment. With interest rates at only 1.5 per cent and heading lower, Japanese investors have been buying more gold. According to Japanese trade statistics, gold imports soared to 16,998 kilograms in February from 13,436 in January and 13,874 in December. Dealers said March and April imports were expected to rise higher. Japanese demand for gold also surged because of the Kobe earthquake, according to the World Gold Council. Kerr Cruikshanks, chief executive, Far East, of the World Gold Council, a promotion body controlled by international mining corporations, estimated that gold purchases in Japan surged to about 43 tonnes in the first two months this year, a third more than in the same period last year. Japanese gold consumption was 212 tonnes for last year against 220 tonnes in 1993. In its most recent rally, gold rose by about 3.5 per cent to $395, but producers sold heavily, said dealers. Southeast Asian buyers who were keen on gold at about $380, however, withdrew from the market.