Commodity Trade Mantra

Posts Tagged ‘World Gold Council’

A More Robust Understanding of the Price of Gold & Gold Valuation

A combination of a top-down and bottom-up approach is required to develop a more robust understanding and valuation of gold. Certain inputs put together, this recommended framework allows investors to use current variables and easily available economic forecasts to form a consistent, self-contained and intuitive view on the price of gold.

Gold Jewelry Buying Expected to be Exceptionally Strong

Plentiful monsoon rains in India tend to drive up demand for gold & gold jewelry among rural, income-flush farmers, who make up a third of the country’s consumption of the yellow metal. Gold jewelry sales in India are expected to surge as much as 60% over last year, during this year’s festival season thanks to the fortuitously timed sharp drop in gold prices.

Gold Edging Close to Triggering a “Buy” Signal. Will You Buy?

Banks added 27 tonnes to their reserves in August in an effort to diversify their assets and hedge against their own policies. In a survey of 19 central bank reserve managers, the WGC found that close to 90 percent of them have plans either to increase their gold reserves or maintain them at current levels. Investors might consider doing the same, for the very same reasons.

Will India Revive It's Love Affair With Gold Anytime Soon?

India’s gold demand fell significantly in the first half of 2016. World Gold Council data show the combined demand for jewellery and investment at only 247 tonnes. Import during January-June was 248 tonnes, 42% lower than the corresponding period last year and lowest since 2009. Clearly, many variables are at work. Only time will tell if India’s love affair with gold revives!

Due to Financial Cancer of Debt, Devastation is Our Future- Gold the Only Remedy

The fact that demand for gold is soaring says a great deal about investors’ combined frame of mind these days. People are scared. I fear devastation is in our future. If central bankers had succeeded in their efforts, we would have no need for negative rates. There is simply too much debt (financial cancer) in the system to save it. And buyers of gold know this.

Does the Current Gold Price Justify the Big Gains in Gold Stocks?

Despite the 25% decline in the gold price since 2013 to $1,050, profit margins only fell by 12% as the industry responded by cutting costs and restructuring their operations. With gold now trading at $1,350 per ounce and AISC holding steady, net profit margins for the industry have increased from $220 to over $500 per ounce – an increase of 127% in just 7 months.

Most Asset Classes at All-Time Highs. Gold Yet 50% Below - Get It Now

The US dollar is at a multi-decade high, and both US stocks and bonds are at all-time highs. It’s generally not the greatest investment strategy in the world to buy assets at their all-time highs. Unlike stocks and bonds, gold is NOWHERE NEAR its all-time high, at least in US dollar terms. In fact gold can still appreciate nearly 50% before it breaks its previous price record. So?

A Perfect Storm Brewing for Gold Prices to Storm Ahead

So far this year, gold prices have moved up by just under 30%. There appears to be solid, market-based support for gold prices. New gold supply is contracting. Plus, there’s continuing demand for gold from China & the U.S. for investment reasons. I think in this cycle, gold prices will ultimately set an all-time high. There’s still a tremendous amount of debt in the system.

Gold Investment Necessitated by Failed Monetary Policies

Many analysts are interpreting weak Japanese Government Bond demand as a signal that investors are starting to lose confidence in the effectiveness of unconventional monetary policies, following increasingly desperate bids by the world’s central banks to reflate the global economy. In this environment, we believe investors are using gold to hedge portfolio risk as they add more stocks.

Gold will Never Let a Good Crisis go Waste & There are Lots of Them Coming

The current geopolitical uncertainty has been years in the making & extends beyond the gyrations in British politics. Negative or low interest rate environments, macro risks & deteriorating confidence towards central banks & monetary policy are the reasons cited for the fresh interest in safe haven gold. IF there’s one thing that can be said for gold, it’s that it never wastes a good crisis.

Negative Yields On Global Government Debt Drives Gold Demand

It’s unprecedented that a third of all global government debt has negative yields. Which drives gold demand. Effectively what we’re seeing is people’s pensions being decimated because the policymakers have had very few if any alternatives left. It is in this environment that gold will help satisfy need. It’s more about protection of wealth rather than creation. That’s where gold plays.

Foreign Central Banks Dumping US Debt & Buying Gold at Alarming Pace

Central banks around the world sold off a net $17 billion in US Treasury bonds in March. Sales set a record in January, hitting $57 billion. Between December and February, China’s central bank sold off an alarming $236 billion. By selling US debt, central banks can get hard cash to buy up their local currency. But many of them aren’t just purchasing local currency. They are buying gold.

Gold and Silver Surge Amid Crude Oil and Copper Carnage

We have repeatedly highlighted the upside potential for gold following a period of consolidation. The market is bracing itself for the worst earnings season since the 2009 crisis. A weaker dollar, the risk of rising stock market volatility, and the continued focus on negative interest rates may attract renewed interest for gold and silver earlier than expected.

A Long-Standing Love Affair Between India And Gold

India has never experienced a bear market of any consequence in gold. Since 1970 the Indian rupee has lost 88.7% of its purchasing power compared to the U.S. dollar. But the people’s purchasing power has been maintained thanks to gold. Maybe that is why people are reluctant to give up gold for a piece of government paper. Westerners may have something to learn from India’s love affair with gold.

Gold Prices Are Soaring Right Now - Here's What's Next

The World Gold Council said it’s largest customers, China, India & Russia will be adding to their stockpiles of physical gold & that the global stock market turmoil would be enough to keep gold demand strong this year. Well, I would say that’s all fine and good, but the main currency that gold is concerned about is the dollar.

Who Says Gold Lost Its Appeal As A Safe Haven Asset?

Until the new year, sentiment appeared poor & many gold bulls were finding it hard to stay optimistic. But after the price jump last week, large exchange-traded gold funds saw massive inflows, confirming a shift in investors’ attitude toward the precious metal. Over the long run, holding 2% to 10% of an investor’s portfolio in gold can improve portfolio performance.

Here Is What Will Fuel The Mighty Upleg In Gold In 2016

With the gold positions of speculators & investors alike so radically skewed by the Fed’s extreme market distortions, vast mean-reversion buying is inevitable in 2016 to start to normalize gold investment back to reasonable levels. Coming off of such an anomalously-low base where virtually everyone loathes gold, all this gold buying is going to fuel a mighty gold upleg.

US Mint Sales of Gold Coins Fall In October After 234% Surge in Q3

In historical comparatives, demand for gold coins in October was 38th lowest by total weight and 56th lowest by coins counts for any month from January 2006 through present. October sales saw significant decline in demand for gold coins in 7 out of 10 years. In other words, October tends to be a more bearish month of U.S. Mint gold coins sales.

Shorts Savage Gold Futures After a Hawkish Surprise by the Fed

American gold futures speculators just savaged gold again on their historically-wrong and irrational belief that Fed rate hikes will decimate gold. Last week’s surprisingly-hawkish FOMC statement unleashed furious gold futures selling, battering gold back below its new uptrend’s support line. Futures shorting soon reverses, as those positions must soon be covered.

India Issues Its First Sovereign Gold Coin… to Curb Gold Imports

It’s estimated that less than 10% of all Indian gold demand is in bars & coins. That might change this month as the India Government Mint will issue its first-ever sovereign gold coin, just in time for the fall festival season, which kicks off Nov 11. The gold coin will reportedly feature the Ashoka Chakra, the traditional 24-spoked symbol that appears on India’s national flag.

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