Articles
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The Weekly Gold Digger!
The US Dollar has taken the brunt of a 138,000 Employment report for May but now looks to be on the rebound going into next week’s Fed meeting. While the sentiment has a rate hike built-in for the next Fed meeting, if they do not hike, the Gold should spike up. If the rate hike occurs as anticipated, the Gold should dip initially, then come back to trend higher. There is too much uncertainty with the political tensions and the global landscape. With this in mind, the Gold is the one safe-haven that the investment world cherishes when there is uncertainty. The Gold market may be paused from extending too much higher as the June 13th - 14th FOMC is straight ahead. Once the meeting is out of the way, the Gold market may be able to extend higher and follow-thru in a seasonal tendency to rise towards December. The inflation target of 2% and full employment are within our sights. Inflation may be overshot which may be just the recipe for a Gold uptrend. As of the end of the first quarter, Gold-backed ETF’s were around 2.277.5 tons. In Europe, the Gold ETF’s had inflows of 109.1 tons for the first quarter according to the World Gold Council. Gold bar investments mostly came from China up 9 % to about 100 tons. The Central Bank demand for Gold waned with only 76.3 tons added to reserves. The Perth Mint reported Gold coin and bar sales in May were about 29,679 ounces. North American holdings increased 25.4 tons. The SPDR Gold Shares rose 21.0 tons to 853.4 tons. iShares Gold Trust increased by 4.5 tons to 204.4 tons according to the World Gold Council. US Gold exports as of January thru February increased to 101 metric tons. Hong Kong, China and India received 61.8 tons of the total. According to the World Gold Council, India’s demand for Gold jewelry was up 16 % in the first quarter. India and China imported 98.3 metric tons in April. Projections are that China may purchase 1,000 metric tons in 2017. The global environment lends itself to uncertainty which is the fuel for the Gold. The rate hike is the one pause that may suppress the Gold from moving substantially.
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