Gold

Gold

18 May 2017Reading time: 2 minutes

After the first round of the French election on april 23 Gold went down. Before the results the gold price was about USD 1290 per ounce and dropped to USD 1255 per ounce after the results. The possibility of having a Jean-Luc Mélenchon (far-left candidate) versus Marine Le Pen (far-right candidate) was the main reason for the soaring gold price. Both candidates  wanted to quit the European union and the Euro, which might have been be a disaster for French economy.

 

Emmanuel Macron was elected the 25th president on may 7 of France in the second round, the last uncertainty disappeared and the gold price went down. According to Goldman Sachs analysts the gold price could drop to USD 1200 per ounce in the next month’s mostly because of strong dynamic in the US-economy as well as a potential rates hikes by the FED. Moreover the unresolved problems in the EU such as  BREXIT and  the Greek government-debt might have implications on the Gold price. However the futures development remains to be seen

 

Last week the World Gold Council (WGC) published its  quarterly report on Gold. In the first Quarter of 2017 the gold demand was 1,034.5 tons, which implies a decline of about 18 percent compared to Q12016. According to the WGC the lower demand in Q1 2017 results from lower inflows into Gold-ETFs. The mine production remained unchanged in Q1 2017. However the production by recycling went down by around 12%, as a consequence gold supply went down. A factor that might sustain the Gold price is the growing demand towards gold in India. Recently the government demonetized the 500 INR and 1.000 INR. According to WGC, as a consequence thereof Gold demand in Indianincreased by roughly 15 per cent during the first Quarter of 2017 to 123.5 tons. WGC maintains a full year global demand forecast in 2017 at 650-750 tons.


 

 

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20/09/2019 12:04:03