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25/09/2020 – This Week in Gold

Price Movements Summary

Gold opened on Monday at $1,953 per ounce. The price suffered a drop of nearly 3% on Monday alone, and finished the week nearly 5% down at $1,862. As equities fell for a fourth consecutive week, gold followed the markets down due to heavy selling to meet margin calls in the early days of the week. A brief rally on Friday failed to regain much of the ground lost earlier in the week.

25/09/2020 - This Week in Gold

Election Uncertainty

Analysts at Citibank highlighted uncertainty over the US Presidential election as a possible factor in leading to higher gold prices. As President Trump refused to rule out challenging an election loss, the fear of extended legal action afterwards was raised and caused jitters in financial markets. In Citibank’s quarterly commodities outlook analysts increased their forecast for bullion futures, implying a rise of more than $200 from its current level. Citi analysts also  mentioned Trump’s plan to move quickly to replace the late Justice Ruth Bader Ginsburg on the U.S. Supreme Court as heightening the complexity of the race. 

The election could be a major catalyst for volatility in the fourth quarter, which Citi analysts identified as “one reason why we expect gold prices to hit fresh records before year-end.”

Strong Dollar Hurts Gold

Despite subdued US yields, the dollar continued to trade higher, putting extra pressure on the gold price. The greenback was buoyed by stronger than expected US mortgage applications. The dollar continued to benefit from a safe-haven bid, which was not the case for gold this week. Despite this trend for the week gone by, there has been a significant increase in gold prospects among hedge funds and private investors as the Fed announced they are promising to hold interest rates to near zero until 2023.

In an article in which he was highly critical of the Federal Reserve’s inflationary bias, John Pender of the Financial Times wrote that “this boils down to choosing between governmental paper promises and real assets such as property, commodities and gold. It is, in the time-honoured phrase, a no-brainer.”

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This Week in Gold – 11/09/2020

Gold Price Movements Summary

The dollar increased strength on Monday, causing gold to ease but was restricted from falling too far by the uncertainty of possible developments by central banks. On Monday at 1pm, Spot gold was down 0.3% to $1,926.49.

This was followed by a sharp rebound in the price of gold on Tuesday and Wednesday, buoyed by increased investments from hedge funds. According to the most recent trader’s report, gold futures and options saw an increase of 11k contracts in their long positions by managed money

This Week in Gold - 11/09/2020

Once again, the precious yellow metal thrived on the suffering of the dollar on Thursday. Gold pushed higher following optimistic comments from the ECB over new stimulus measures to be introduced.

Gold price set to push above $2000 as GBP falls

Amid the economic fallout from the coronavirus pandemic and emergency Brexit talks, the sterling is continuing to weaken. Thus, causing the price of gold to edge above resistance levels and could break above $2000 an ounce.

This Week in Gold - 11/09/2020
ECB President Christine Lagarde

There were also reports earlier this week, that a number of senior British legal advisers quit as a result of plans to scrap important aspects of the Brexit withdrawal agreement. This points to further weakness in the GBP/USD ratio.

However, further weakness cannot be ruled out as the post Brexit relationship between the UK and the EU next year becomes an increasingly dominant theme for Sterling traders

Martin Essex, analyst and editor at DailyFX, part of IG Group.

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This Week in Gold

04.09.2020

Gold Price Movements Summary

Gold started the week at $1,964/oz, and rose to reach $1,992 on Tuesday as the dollar weakened. A sell off of the dollar was triggered by the Fed’s new monetary policy strategy which is likely to increase inflation and keep interest rates lower for longer.

This Week in Gold

The U.S. Department of Labor released their weekly jobless claims report showing that the initial jobless claims fell by 130,000 to a seasonally adjusted 881,000. Gold futures on the COMEX division of the New York Mercantile Exchange fell on Thursday on these better employment figures.

However, a report released by the U.S. Department of Commerce on Thursday gave Gold some support and was prevented the precious metal from falling too far. The report showed an increase in the U.S. trade deficit of 18.9% to 63.6 billion U.S. dollars in July.

Fund That Beat 82% of Its Peers Sees Gold as Safe Election Play

Investors were seen to pull out of equities this week and focus their attention on gold and bonds as a turbulent US election is in sight. The Dynamic Precious Metals Fund outperformed 82% of its peers this year. Vice president and portfolio manager Robert Cohen sees gold as a “nice safe” bet heading into the U.S. election in November.

The fund achieved this success by climbing 63% this year from predominantly gold and silver investments

“Given the amount of debt in the world, the only politically acceptable way to get out of debt is to literally print your way out of it, which effectively devalues the currency and we’re going to see that continue,”– Robert Cohen

Cohen alludes to how in such a case as this, investing in gold at this stime will increase the stability of the future purchasing power of the investor.

Strengthening Silver

Heraeus released a report Tuesday, stating how it continues to see more upside future potential for silver.

Heraeus Precious Metals

Analysts at Heraeus Precious Metals have set a price target of $35 an ounce for silver by the end of the year, a gain of 21% from current prices. This would a sharp incline from last December’s price of $28.725 an ounce.

On Wednesday, Silver was hovering not far away from its upper consolidation range at $29.84. Although a lot of political and economic uncertainty has already been incorporated into this price, the analysts said that conditions could continue to deteriorate sending silver higher.

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Gold Rallies on Weakened Dollar

Gold Price Movements Summary

Gold finished last week at $1,965/oz, up more than 1% up on the week’s opening of $1,940. After a poor start to the week that saw the spot price drop sharply to $1,911 on Wednesday, it rallied to finish the week 2.8% up from the week’s low. Further market movements are expected this week with August’s jobless figures for the US due to be released on Thursday, and non-farm payroll figures being announced on Friday.

Weakening Dollar

The week’s major movements followed Federal Reserve chairman Jerome Powell’s comments regarding his average inflation target of 2%. Investors signalled a floundering faith in the US Dollar as a safe haven as they sought safety in other currencies or assets. Bloomberg reported that investors were hoarding gold, Bitcoin and whisky as a means of hedging against inflation, a trend that was evident in the immediate aftermath of Powell’s comments. 

The global investment manager PIMCO stated that despite a strong rise in recent months they still viewed gold’s current price as attractive for investment. Mounting government debts and the poor yields available on the bond markets were cited as key factors in their thinking.

Strengthening Silver

Gold Rallies on Weakened Dollar

Silver also rallied after the comments from the Fed Chairman, and on Monday the Gold to Silver Price Ratio (AU/AG) dipped below 70. This is down significantly from when it spent much of the early months of the year comfortably above 100. After a high of 120 in mid-March, the ratio is now lower than any time since early 2017.

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This Week in Gold – 21 August

Buffett Long on Gold

Berkshire Hathaway disclosed its holding in Barrick Gold at the end of last week, revealing ownership of 21 million shares valued at $560m. Warren Buffett famously bought 3,500 tonnes of silver in 1997, but has previously been disparaging of investing in gold, which gave added significance to the move. Buffett’s move saw a sharp rise in Barrick shares, although they suffered later in the week due to events in Mali (see below). Buffett has said in the past that “Gold is a way of going long on fear”, and obviously anticipates more economic disruption amidst the continuing fallout from COVID-19.

This Week in Gold - 21 August
Troy Gayeski of SkyBridge Capital

SkyBridge Capital increased their exposure to gold this week, with co-CIO Troy Gayeski warning of a “massive currency debasement” in the coming months due to the huge increase in money supply in recent months. Gayeski flagged particular concern with the US Dollar, and mentioned a range of $2,100 – $2,200 per ounce value for gold by the end of the year. At close of business on Friday it stood at $1,935.

Mali

In Mali President Keita was removed from power on Tuesday by an army-led coup, which led to the closure of the country’s borders on Wednesday. Mining stocks with exposure to Mali suffered as a result, with Barrick Gold sliding more than 2.5%. The plight of Resolute Mining (which fell by more than 10%), Cora Gold and AngloGold Ashanti showcased the risks associated with holding mining stocks or ETFs instead of physical gold. While physical gold is often used as a hedge against geopolitical uncertainty, mining companies often have exposure in politically unstable regions such as West Africa. It is still unclear as to how the coup will affect future gold mining in the country – which produced a record 46,000 kilograms last year.

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Increase in Safe Deposit Box & Gold Bullion Demand

Seamus Fahy, Co-founder of Merrion Vaults on Sky News discussing increase in Safe Deposit Box & Gold Bullion demand due to Brexit.

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Impact of Brexit on demand for Safe Deposit Boxes and Gold Bullion

Co-Founder of Merrion Vaults live on UTV discussing impact of Brexit on demand for Safe Deposit Boxes and Gold Bullion. December 2018

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I slid from oil into a glittering career of gems, vaults and gold

He started out in the oil industry, but it didn’t take long for Séamus Fahy to shine.

Fahy left St Nessan’s school in Limerick to study accounting and finance at the University of Limerick, which landed him a job buying and selling barrels of crude at state oil company Irish National Petroleum Corporation.

He stayed until the firm was sold off and privatised, and new owners Phillips Petroleum offered an attractive redundancy package.

“I got nine weeks for every year I worked, and I’d been there 12 years,” he revealed. “I was delighted.”

He quickly landed a job in an oil company in London and stayed for a further four years before venturing into entrepreneurship. “I was at a wedding and seated beside two guys…

Read whole article here

buy and sell gold and diamonds

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Gold price rising…..The Perfect Storm?

As gold hits a 5 month high (at time of writing) Investment commentators worldwide are all agreeing on one thing: it appears that the ‘perfect storm’ is on the horizon for this safe-haven asset.

Most investors will know, historically the price of gold rises in times of Political and Economic unease. With Geo-political tensions currently rising throughout the world due to tensions between the U.S., North Korea and Russia, investors seem to be running to the safe-haven asset of gold.

Let’s not forget the element of Brexit, also in-motion but with no clear roadmap as to how that will pan out yet. In France, Le Pen and the upcoming elections there, will further shake up the economic landscape depending on that outcome.

This uncertainty is supporting physical demand for gold, with holdings in SPDR Gold Shares, the largest exchange-traded fund backed by gold, rising 4.2 metric tons to 842.4 tons as of Tuesday. That’s the highest in more than a month.

The simple fact is in times of turmoil gold tends to go upwards in price. The past has shown that gold is a great hedge, when stocks & shares markets are falling your gold should then be performing well…this is the very essence of a good financial hedge.

When it comes to precious metals though, the most regular advice is to buy and own PHYSICAL metals. With what appears to be ‘the perfect storm’ forming for the price of gold to increase, the Bulls are on the prowl and smart investors are following suit putting their money on gold.

As J.P. Morgan once said – “Money is gold, and nothing else.”

 

Seamus Fahy

Head of Trading

Merrion Gold.

 

For further information on Merrion Gold call: +353 (0)1 254 7900 or go to: www.MerrionGold.ie

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How to Buy and Store Gold Bullion in Ireland

How to buy and store Gold and Silver Bullion in Ireland, Scotland and mainland UK with Seamus Fahy, the Head of Merrion Gold

Seamus Fahy is Head of Merrion Gold in Ireland, Scottish Bullion and Newcastle Bullion in the UK. Having been a long-term personal investor in precious metals and coming from the business background of running a Vault facility, Seamus was involved in the starting-up of Merrion Gold in 2013. Since then the company has grown to include trading desks in Scotland and mainland UK. With a keen eye and interest in world economics and politics, Seamus and the team at Merrion Gold have rapidly built up a reputation for straight-talking, transparent dealings and educating investors in what is best for them when purchasing or investing in precious metals.

Where does gold / silver derive its value from?

The answer to this question stretches back thousands of years! There are Egyptian hieroglyphs from as early as 2600 BC describing gold as a valuable item. Some of the first minted gold coins to be used as currency were found to be from around 600 BC in Asia. The basic reason gold has come to be so valuable must surely derive from the fact that from days past it was an easy way to move around or travel with your wealth. Of course, it could be worn as jewellery, it is hugely resistant to corrosion and it is (relatively) light. Today the world usage and consumption of new gold produced is about 50% in jewellery, 40% in investments, and 10% in industry.

A lot ofthe the above can be said of silver also, except the world usage and consumption figures are quite different with about 60% of silver being used in industry and teh remainder in jewellery and investment. A little known fact and probably a good way to put the price of gold and silver into perspective is that there is more Silver mined every DAY than there has EVER been gold mined in the history of records!

In general, what is the nature of the relationship between the British and Gold/Silver?

We find on the most part the British tend to move towards investing in gold in times of uncertainty – both political and economic. The Lions share of investors will look at gold as a medium to long-term investment (4-5 years+), with most happy to ride out the dips that usually come at some stage along the way and wait for their investment to top the price they bought at. We have more and more smaller investors getting interested in buying gold and these would tend to be 1-5oz buyers who will buy coins as opposed to bullion. No matter which of these brackets the buyers fall in to they tend to be more educated on the safe-haven value of gold these days.

Which is your favourite gold/silver coin and why?How to Buy and Store Gold Bullion in Ireland

My own personal favourite coin is the 1oz Gold American Buffalo. I think it is one of the most recognisable coins out there and it’s one of the few coins which I like the design on both the front and reverse. It has a great feeling of heritage and nostalgia about it, and I think it very much looks like the kind of coin one would find in a treasure chest of old!

Do you notice any difference in psychology between the silver and gold investor?

In my experience I find gold investors tend to be a little more relaxed in their attitude to their precious metals investments – most are happy to wait out a longer timescale for their investment to mature – silver investors tend to look for a quicker ‘turnaround’ on their investment. I also feel the silver investor would be more willing to take a higher risk.

What are the most common mistakes of physical Gold and physical Silver investors?

I think the most common mistake first-time investors will make is automatically opting to buy coins – we always ask the purpose of the investment so as to be able to give the best precious metals advice to the client. Clients should understand that with coins there are minting charges and you must also take into account that some coins are more in-demand than others, therefore it is possible that someone purchasing a 1oz gold coin could end up paying a lot more for that 1oz coin than they would a 1oz bullion bar. When they go to sell back to a bullion dealer it will almost always be just valued on the weight, therefore (unless you sell a coin to a coin collector) you will rarely make this difference in price back when you go to sell. There are other pitfalls involved when purchasing gold for the first time, which is why at Merrion Gold we strive to educate our clients as well as serving them in the most efficient manner possible.

Are there any tax advantages in Ireland when investing in Gold or Silver?

The most obvious is that gold is VAT Free, whereas there is VAT applied to all silver sales.

In your experience which silver/gold coin is the most difficult to fake?

The most difficult coins to fake are the newer coins – the likes of the 2017 Britannia and the Canadian Maple (from 2015 on) – these coins have laser-precission waves on the face of them which are practically impossible to fake. It must be noted however that no coin is completely impossible to fake – this is why here at Merrion Gold we have a 6-level testing set-up in-house. Buyers should always be wary of any dealer who does not have sufficient testing set-ups in their business.

Can you describe your 6-level testing set-up?

At Merrion Gold, we have a 6-level testing set-up at our disposal in-house. This enables us to test every precious metal that comes through our company, when either buying or selling. Even though we only trade in LBMA approved refineries, this testing ability means we can ensure all precious metals through our company are 100% as they should be. It is worth noting that some companies will use 1 or 2 methods of testing (some listed below), but we find when all of the testing variations below are used together, the result is as definite as you can get.

Our testing set-up includes:

  1. Digital Weighing scales
  2. Digital Caliper and dimension matching
  3. Magnetic Balance Weighing – this measures the (apparent) weight change in the metal by use of a super-strong test magnet positioned on a digital balance.
  4. Electronic Conductivity measuring apparatus
  5. Fisch testing implements (for coins and used only in-conjunction with the above)
  6. Use of Bullion code matching system.

Can you briefly describe the History of Merrion?

How to Buy and Store Gold Bullion in Ireland

Seamus Fahy

When we started Merrion Gold in 2013, we wanted to create a world-class gold bullion and coin trading service. We offer our clients the complete privacy and security they deserve, this is why we are housed within an actual vault facility. This not only offers clients an environment with total security – but we also offer them the ability to purchase, collect and store their precious metals in the one place.
Our trading volumes have increased year on year, proving to us that if you offer the right service and value to clients they will return time and again. In 2016 we opened our second trading desk in Scotland called Scottish Bullion – and in January of 2017 we opened Newcastle Bullion in the UK.

Can you tell us more about the services you offer?

We buy and sell physical gold bullion and coins. We only deal with LBMA approved refinery’s so our clients can be sure that all gold we sell is ‘good-delivery’ gold. We also have a 6-level testing set-up at Merrion Gold, where all gold moving through us (in OR out) is fully tested and verified. We do not offer any financial advice as we are not QFA’s – however we will give you the very best precious metals advice that you can get.
We also offer safe deposit box rental within the vault (through our sister-company Merrion Vaults) where you can store your precious metals and/or any other valuables you may have.

Why do customers choose Merrion?

I think customers chose Merrion because we are completely transparent and honest in our dealings. The security of being housed within a vault is also a huge plus for us. Our traders have a wealth of knowledge and we try to educate new clients as to what is the best product/s to suit their requirements. Some clients who have given us reviews and feedback online always state that our professionalism and efficiency is second to none. We enjoy what we do here at Merrion Gold and this obviously comes through in our dealings with clients.

Do you sell gold outside the UK / EU?

We can transact with any client anywhere around the world – however when you purchase from us you must collect from one of our vaults. We have vaults currently in Ireland, Scotland and UK. We do not ship to anywhere except to our vaults. If the client cannot make it straightaway for their gold collection, we will securely hold their purchase for them in our company safe deposit box within our vault for up to 30 days at no extra cost.

What are the storing costs after the first 30 free days?

We can store clients purchases within our company vault box for up to 30 days at no cost to the client, to enable them sufficient time to collect their purchase. After 30 days the cost is capped at €45 per month.

Where can potential customers find more about your services?

Potential customers can call me directly at: +353 (0)1 254 7901 – Seamus Fahy – Head of Merrion Gold or you can view our website at: www.merriongold.ie

Originally published here

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