| From: Black Blade | 3/25/2023 12:21:12 AM | | | | | | Platinum seen at $1500 by year-end amid South African power crisis - BofA
Commodities 10 hours ago (Mar 22, 2023 01:02PM ET)
By Barani Krishnan
Investing.com - Platinum prices are expected to rise to $1,500 an ounce by year-end, underpinned by the power crisis in South Africa as chronic electricity outages undermine one of the world's largest operators of mines, Bank of America said in an investors' note Wednesday.
"Power supply [is a] long-standing issue for South African miners," analysts at BofA Securities wrote in the note. "The power situation in South Africa has gained attention as power cuts have become more frequent."
South Africa is a key platinum supplier with a global market share of 75% and it wasn't surprising that platinum prices have remained resilient amid the nation's power crisis, the note pointed out.
Hosting Robert Baxter, CEO of South Africa's Minerals Council, to a fireside chat on the power crisis, BofA said it will take time to ensure stability in the country's electricity supply.
"Bringing power plants back from maintenance, solar water heaters and PV panel systems are among the options to alleviate pressure on the grid. In the medium term, the private sector must bring on capacity," BofA said.
In the meantime, national power Eskom needs to fix its asset base and sell all concessions of power generation capacity that it can't run, BofA said, adding: "Self-generation of power is [a] critical solution for miners."
Given that the crisis won't be resolved anytime soon, BofA said it was optimistic of a large rally in platinum prices by December.
"As such, we remain constructive on platinum and see prices rallying to $1,500/oz by year-end," the BofA note.
Platinum futures on New York's Comex were trading at just over $990 an ounce by 12:45 ET (16:45 GMT). |
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| To: Black Blade who wrote (29606) | 3/25/2023 2:04:40 AM | | From: nicewatch | | | | Saturday March 11, the day after SIVB was seized by the government, Apmex had a record day for Saturday silver sales by ~50% and over 300% above average. For gold it was a Saturday record by ~30% and over 200% above average.
The CEO of bullion dealer Miles Franklin recently said they did about 10% of their entire 2022 sales in the week following the SIVB collapse. |
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| From: Black Blade | 4/14/2023 4:24:27 PM | | | | | | Gold and Silver Surge On Recession Worries and a Dollar Decline ........................................................................................................
Last week, gold and silver saw gains as recession worries persisted. The pair had plenty of tailwinds throughout this week in a declining dollar, continued recession fears, and rate hike bets. In terms of economic news, investors anticipated consumer and wholesale inflation data, which was due out Wednesday and Thursday, respectively.
Gold slipped below the $2,000 level on Monday, as the dollar index ticked higher and investors digested a U.S. jobs report from the prior Friday, showing 236,000 new jobs in March.
Stocks in the U.S. were mixed on Tuesday, as investors anticipated the release of CPI and PPI data. On the same day, the dollar edged lower which cleared the path for a 1% gold uptick to $2,018. On Wednesday, data showed that consumer prices increased by 0.1% in March, which was the smallest uptick for that index in three months. The core rate of inflation, which does not include food and energy, was up by 0.4% in March.
While inflation still rose in March, gains were largely in line with expectations. For some, this meant that the Fed was more likely to pause its current rate hike campaign. In his speech, Chicago Fed President Goldsbee suggested the central bank should be cautious with future rate hikes, especially considering recent banking sector struggles. Some other Fed officials are still favoring a 0.25% rate at the next policy meeting on May 3rd.
Meeting from the Fed’s March 21-22 meeting were also released on Wednesday. The minutes showed that officials remained concerned about inflation, tighter credit conditions, and a recession later in 2023. Recession worries weighed on Wall Street sentiment throughout Wednesday, as The S&P 500, Nasdaq Composite, and Dow Jones Industrial Average all ended the day lower.
Gold and silver momentum persisted through Thursday, as the dollar continued its downward trend, and recession worries intensified. Gold neared a fresh all -time high and would end the day 1.6 % higher, at $2,044. Meanwhile, silver managed to breach $26 for the first time in nearly a year.
This morning, gloomier economic news once again drove U.S. equities lower. Data released this morning showed retails sales slid lower by 1% in March, when a 0.5% decline was forecasted. Meanwhile The University of Michigan consumer sentiment survey showed that Americans remain worried about persistent inflation. Despite this morning’s dip, all three major averages are currently on track for small weekly gains.
Gold pulled back from its recent highs this morning as the dollar bounced. Currently, the yellow metal is near $2.003, which is 0.5% higher for the week. Silver is currently eying a 2.2% weekly uptick, at $24.78 an ounce. |
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| From: Black Blade | 4/26/2023 12:54:42 AM | | | | | | What Strong Gold Says About The Weak Dollar ........................................
Tuesday, Apr 25, 2023 - 09:30 AM
Authored by Ruchir Sharma, op-ed via The Financial Times,
The US has been weaponising its currency - but that comes with a cost...
Today commentators overwhelmingly agree that a weakening US dollar cannot possibly lose its status as the world’s dominant currency because there is “no alternative” on the visible horizon. Perhaps, but don’t tell that to the many countries racing to find an alternative, and such complacency will only accelerate their search.
The prime example right now is gold, up 20 per cent in six months. Surging demand is not led by the usual suspects — investors large and small, seeking a hedge against inflation and low real interest rates. Instead, the heavy buyers are central banks, which are sharply reducing their dollar holdings and seeking a safe alternative. Central banks are buying more tons of gold now than at any time since data begins in 1950 and currently account for a record 33 per cent of monthly global demand for gold.
This buying boom has helped push the price of gold to near-record levels and more than 50 per cent higher than what models based on real interest rates would suggest. Clearly, something new is driving gold prices.
Look closer at the central bank buyers, and nine of the top 10 are in the developing world, including Russia, India and China. Not coincidentally, these three countries are in talks with Brazil and South Africa about creating a new currency to challenge the dollar. Their immediate goal: to trade with one another directly, in their own coin. “Every night I ask myself why all countries have to base their trade on the dollar,” Brazilian president Luiz Inácio Lula da Silva said recently on a visit to China, arguing that an alternative would help “balance world geopolitics”.
Thus the oldest and most traditional of assets, gold, is now a vehicle of central bank revolt against the dollar. Often in the past both the dollar and gold have been seen as havens, but now gold is seen as much safer. During the short banking crisis in March, gold kept rising while the dollar drifted down. The difference in the movement of the two has never been so large.
And why are emerging nations rebelling now, when global trade has been based on the dollar since the end of the second world war? Because the US and its allies have increasingly turned to financial sanctions as a weapon.
Astonishingly, 30 per cent of all countries now face sanctions from the US, the EU, Japan and the UK — up from 10 per cent in the early 90s. Until recently, most of the targets were small. Then this group launched an all-out sanctions attack on Russia for its invasion of Ukraine, cutting off Russian banks from the dollar-based global payment system. Suddenly, it was clear that any nation could be a target.
Too confident in the indomitable dollar, the US saw sanctions as a cost-free way to fight Russia without risking troops.
But it is paying the price in lost currency allegiances. Nations cutting deals to trade without the dollar now include old US allies such as the Philippines and Thailand.
The number of countries with central banks looking at ways to launch their own digital currency has tripled since 2020 to more than 110, representing 95 per cent of the world’s gross domestic product.
Many are testing these digital currencies for use in bilateral trade — another open challenge to the dollar.
Though some doubt a dominant dollar matters for the US economy, high demand for the currency in general tends to lower the cost of borrowing abroad, a privilege America sorely needs today. Among the top 20 developed economies, it now has the second highest fiscal and current account deficits after the UK and the second highest foreign liabilities (as reflected in its net international investment position) after Portugal.
The risk for America is that its overconfidence grows, fed by the “no alternative” story. That narrative rests on global trust in US institutions and rule of law, but this is exactly what weaponising the dollar has done so much to undermine. It rests also on trust in the country’s ability to pay its debts, but that is also slipping, as its reliance on foreign funding keeps growing. The last line of defence for the dollar is the state of China, which is the only economy sufficiently large and centralised to challenge US currency supremacy — but even more deeply indebted and institutionally dysfunctional.
When a giant comes to rely on the weakness of rivals, it’s time to look hard in the mirror. When it faces challenges from a “barbaric relic” such as gold and new contenders like digital currency, it should be looking for ways to strengthen trust in its finances, not taking its financial superpower status for granted.
* * *
Ruchir Sharma is chair of Rockefeller International |
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| From: Black Blade | 4/26/2023 12:56:02 AM | | | | | | Central banks are leading a revolt against the US dollar and shifting to gold at a record pace, market expert says
Story by fdemott@insider.com (Filip De Mott) • 6h ago
- Central banks are turning away from the US dollar and shifting to gold, Ruchir Sharma wrote.
- Central banks account for a record 33% of monthly global demand for gold, he said in the FT.
- "Thus the oldest and most traditional of assets, gold, is now a vehicle of central bank revolt against the dollar."
The anti-dollar drive spearheaded by Asia has spread to Europe, with France growing sour on the greenback's dominance. Here are 6 rising threats to the buck's supremacy of global trade.
- The dollar's supremacy in global trade faces fresh challenges as several countries float plans to use local currencies in commerce.
- Russia and Iran are working to create a gold-backed stablecoin, while France has pursued a trade deal with China in yuan.
- Here are 6 rising challenges to the greenback's dominance of international trade and investment flows.
The dollar's dominance of global trade and investment flows is facing a slew of new threats as more and more countries draft plans to boost the use of alternative currencies.
For some time now, nations from China and Russia to India and Brazil have been pushing for settling more trade in non-dollar units – with projects ranging from the use of local currencies to a gold-backed stablecoin and a new BRICS reserve currency.
Now, even Europe appears to be jumping on the anti-dollar bandwagon, with French president Emmanuel Macron recently warning against the continent's dependence on the greenback.
With movements to undermine the dollar's unipolar supremacy gathering momentum, it comes as no surprise that the buck's status as a reserve currency eroded in 2022 at 10 times the pace seen in the past two decades, according to Eurizon SLJ Asset Management.
Strategists at the asset manager found that the greenback's share of total global reserves fell to 47% last year, from 55% in 2021 and as much as two-thirds in 2003.
For decades, the US dollar has reigned supreme as the world's reserve currency and is widely used in crossborder trade, especially for commodities such as oil. Thanks to its relative price stability, investors see it as a safe-haven asset in times of heightened economic and geopolitical uncertainty.
The dollar was further bolstered last year by a surge in US interest rates that made it attractive to foreign investors seeking higher yields. It surged 17% during the first nine months of 2022, but has since lost some of its shine on the prospect that the Federal Reserve may soon end its rate hikes as inflation cools rapidly.
Against this backdrop come the latest threats to the greenback's reign — here are 6 currency projects from across the world that are ultimately aimed at undermining the dollar's supremacy.
Assurance in the dollar's dominance ignores signs that countries are serious about seeking alternatives, according to Ruchir Sharma.
This is illustrated when taking account of recent trends in gold: the safe haven commodity has surged 20% in the last half year.
But demand is coming from central banks reducing their dollar holdings, not the "usual suspects" made up of large and small investors, the chair of Rockefeller International wrote in The Financial Times on Sunday.
In fact, central banks account for a record 33% of monthly global demand for gold and are buying more gold than at any time since data began in 1950, he added.
"This buying boom has helped push the price of gold to near-record levels and more than 50% higher than what models based on real interest rates would suggest," said Sharma.
"Clearly, something new is driving gold prices."
Nine of the top 10 central banks buying gold are in developing countries, including China, Russia and India, he said.
Those three countries, along with fellow BRICS nations Brazil and South Africa, are also part of an effort to create a new currency that is separate from the dollar.
"Thus the oldest and most traditional of assets, gold, is now a vehicle of central bank revolt against the dollar," Sharma wrote. "Often in the past both the dollar and gold have been seen as havens, but now gold is seen as much safer. During the short banking crisis in March, gold kept rising while the dollar drifted down. The difference in the movement of the two has never been so large."
He attributes the rush for gold to the increasing use of financial sanctions by the US and its allies, with as much as 30% of nations facing sanctions from the US, European Union, Japan and UK.
That's up from 10% in the 1990s. But after Russia's invasion of Ukraine, the West froze the country's currency assets and kicked it out of the SWIFT system.
"Suddenly, it was clear that any nation could be a target," Sharma wrote.
In the face of the dollar's weaponization, even US allies like Thailand and the Philippines are beginning to seek alternative currencies.
Most notably, the Chinese yuan has been growing its international reach, but Sharma cites another threat — the fact that the number of central banks attempting to create digital currencies has tripled in three years.
"The risk for America is that its overconfidence grows, fed by the "no alternative" story. That narrative rests on global trust in US institutions and rule of law, but this is exactly what weaponizing the dollar has done so much to undermine," Sharma wrote. "It rests also on trust in the country's ability to pay its debts, but that is also slipping, as its reliance on foreign funding keeps growing."
Others have been less wary of de-dollarization fears, citing that the trust in the greenback is difficult to replicate.
Commonwealth's Brad McMillan said even if a strong alternative was to emerge, it would take monumental effort and persuasion to replace the dollar.
And former Treasury Secretary Larry Summers said the yuan isn't a threat to the US dollar, largely because China isn't a predictable and reliable market. |
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| From: Black Blade | 5/5/2023 12:39:20 AM | | | | | | Newmont Merger Would Create The World's Biggest Gold Miner
Thursday, May 04, 2023 - 11:15 AM
By Charles Kennedy of OilPrice
The board of Australia's Newcrest Mining has recommended the latest takeover offer of bigger sector player Newmont, which last month valued the target company at $19.5 billion.
"The latest offer is one that the board would be prepared to recommend subject to successful due diligence during the period," interim Newcrest chief executive Sherry Duhe said this week, as quoted by Bloomberg.
"This transaction would strengthen our position as the world's leading gold company by joining two of the sector's top senior gold producers and setting the new standard in safe, profitable and responsible mining," Newmont's chief executive TomPalmer said, as quoted by Reuters, after the announcement of the latest offer.
Newmont first made a non-binding offer for Newcrest in February, which valued the company at $16.9 billion, but Newcrest rejected that as too low. Then the gold miner tried again, sweetening the offer.
If a deal does materialize, it will bring Newmont's gold output much higher—twice as high as the output of its rival, Barrick Gold, according to Reuters. It would also constitute the third-largest deal involving an Australian company as well as the third-largest M&A deal this year, the news outlet noted.
According to Bloomberg, the deal would also boost Newmont's presence in copper: the basic metal, which is essential for the energy transition, makes up a quarter of Newcrest's total output at present, but the company wants to boost that to 50% by 2030.
Copper is indispensable for wind and solar farm wiring and for EV engines. Yet supply of the metal is under threat because of insufficient new mining capacity coming on stream and falling ore grades.
Warnings of a looming copper shortage have been multiplying in recent months, but they have not yet made any forecasters budge on their expectations of an EV boom combined with a wind and solar boom. |
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| From: Black Blade | 5/5/2023 12:40:39 AM | | | | | | Gold hits record high after near 3-year gap; $2,000 new support
Story by Investing.com • 9h ago
Gold hits record high after near 3-year gap; $2,000 new support© Provided by Investing.com
Investing.com — It took almost three years, but it appears to have been worth the wait for gold longs.
Amid signs the Federal Reserve is ready for a ceasefire with its inflation-fighting rate hikes, gold in one swoop move crossed over to the other side of the rainbow that longs had awaited to revisit since the record highs of August 2020.
Gold for June delivery on New York’s Comex hit an all-time high of $2,082.80 an ounce before settling at $2,055.70, up $18.70, or 0.9%.
The spot price of gold, which reflects physical trades in bullion and is more closely followed than futures by some traders, hit an apex of $2,080.72 before consolidating to $2,046.65 by 14:00 ET (18:00 GMT), up $7.89, or 0.4% on the day.
Previously, the record high in both Comex gold and spot trading of bullion was at around $2,075.
Aside from the Fed’s wavering stance on whether another rate hike was needed in June — the central bank has made 10 raises since the pandemic, adding 5% to key lending rates that some say is choking credit — Thursday’s rally in gold was underpinned by broader concerns over the U.S. economy.
“The force is strong for gold bulls given all the banking turmoil and rising risks that the U.S. will have a tough recession,” said Ed Moya, analyst at online trading platform OANDA.
“The real economy is going to get knocked down a lot given what we are seeing with financials and that will keep demand elevated for safe-havens. Gold is going to shine given this macro backdrop and possibly eye a move above the $2,100 if the de-risking mood on Wall Street remains over the next few sessions.”
Since mid-March, gold has darted in and out $2,000 territory. To anchor itself there, the Dollar Index must not cross 101.47 while U.S. bond yields, led by the 10-year Treasury note, should remain under 3.47% on a daily closing basis, said Sunil Kumar Dixit, chief technical strategist at SKCharting.com.
Gold itself could lurch to $2,098 initially, and then towards $2,148 as looming risks of a U.S. debt default, a growing banking credit crisis and bets of a June pause in Fed rate hikes come to a head, said Dixit.
“A short term correction towards the support areas of $2,020-$2,010 could also turn into a buy-the-dips opportunity for those who lost out on the run to $2,080,” he said. “The upward momentum will remain intact so long as the daily close remains above $2,000 — making that the new normal for gold should the support hold.” |
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| From: Black Blade | 5/5/2023 2:17:19 AM | | | | | | Gold miners show strength as gold nears all-time high
May 04, 2023 5:45 PM ETSPDR® Gold Shares ETF (GLD), GDX, SLVIAU, NEM, GFI, AEM, IAG, HMY, CDE, SIL, AU, SGOL, SIVR, GDXJ, PHYS, PSLV, NUGT, SLVP, OUNZ, SILJ, SSRM, BAR, GLDM, AAAU, XAGUSD:CUR, XAUUSD:CUR, GROY, FGLDBy: Carl Surran, SA News Editor
Filograph/E+ via Getty Images
Gold flirted with record highs and silver settled at its highest in more than a year on Thursday, as U.S. banking concerns and rising fears of a potential recession accelerated a flight to the safe-haven asset.
A weaker dollar also has helped lift gold, with the ICE U.S. Dollar Index down 0.3% this week and more than 2% this year to 101.26.
Spot gold (XAUUSD:CUR) was +0.3% at $2,045.79/oz after climbing as high as $2,072.19, just $0.30 shy of a record, and front-month Comex gold for May delivery closed +0.9% at $2,048.00/oz, its second highest settlement in history behind only the record $2,051.50 hit on August 6, 2020.
Silver (XAGUSD:CUR) scored its sixth straight daily gain, with the front-month May Comex contract closing+2.2% to $26.035/oz, its highest settlement value since April 18, 2022 but still far from the record high $48.70 achieved on January 17, 1980.
ETFs: (NYSEARCA:GLD), (NYSEARCA:GDX), (GDXJ), (IAU), (NUGT), (PHYS), (GLDM), (AAAU), (SGOL), (BAR), (OUNZ), (FGLD), (NYSEARCA:SLV), (PSLV), (SIVR), (SIL), (SILJ), (SLVP)
Most precious metals miners posted gains Thursday, including SSR Mining (SSRM) +9.8%, Gold Royalty (GROY) +5.9%, AngloGold Ashanti (AU) +5.5%, Coeur Mining (CDE) +5.5%, Newmont (NEM) +4%, Agnico Eagle Mines (AEM) +4%, Iamgold (IAG) +3.8%, Harmony Gold (HMY) +3.8%, Gold Fields (GFI) +3.7%.
Gold traders believe they have "a real shot at recording another all-time high as the Fed has finally thrown in the towel on the interest-rate-hike agenda," Naeem Aslam, chief investment officer at Zaye Capital Markets, told MarketWatch. |
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| From: Black Blade | 5/7/2023 1:51:48 AM | | | | | | Gold and Silver Gain on Banking Woes and Rate Hike Hopes
Last week, concerns over the banking sector drove gold and silver higher for modest weekly gains, and the pair’s second consecutive monthly uptick. In terms of scheduled economic events for this week, the emphasis was on the Fed’s two-day policy meeting and subsequent rate hike update. Investors also anticipated employment news, while fears of a banking contagion weighed heavily on risk appetite.
Gold and silver saw little change Monday. The pair ended trading near $1,981 and $24.87, respectively as the dollar gained. On the same day, stocks in the U.S. dipped as news broke that First Republic Bank’s assets had been seized by regulators and sold to JPMorgan Chase, marking the most significant U.S. bank failure since the 2008 financial crisis.
A drop in Treasury yields and fears of a banking contagion drove gold almost 2% higher on Tuesday, to 2,018 an ounce. Stocks fell again on the same day, as the Fed’s 2- day policy meeting began. Wall Street sentiment was further dented by news that job openings in the U.S. had fallen to a 2-year low of 9.6 million.
By Wednesday, market participants had given more than a 90% chance of a 0.25% rate hike, which was later confirmed by Fed Chair Jerome Powell in his news briefing. In his address, Powell acknowledged concerns of a recession in 2023. While it’s expected that the Fed will pause its rate hike campaign at the June meeting, the Fed Chair did not provide any clear direction in that regard. Stocks fell during a Q&A session in which Powell threw water on the idea that the Fed would cut rates sometime in 2023, when he stated that “Our forecast is not for rate cuts coming.”
Gold neared a fresh all-time high at its weekly peak of $2,071 on Wednesday evening, following the rate hike announcement. On Thursday, silver touched a 1-year high of $26.11, while gold ended trading near $2,057, as banking concerns drove a flight to safe-haven assets. On the same day, stocks ended their fourth consecutive day of declines.
Stronger-than-expected U.S. payroll data (+253,000 vs. +188,000 expected) from this morning, further tempered any hopes that the Fed may cut rates. This news also weighed on gold, while stocks rallied. Currently, the Dow Jones Industrial Average and S&P 500 are eying 1.5% and 0.9% respective weekly losses, while the Nasdaq Composite is almost flat for the week.
Following this morning’s jobs news, gold fell by nearly 2% but is eying a 1.6% weekly gain at $2,015 an ounce. Silver also fell this morning, but is currently near $25.60 an ounce, which would be a 1.9% weekly uptick. For this week, gold and silver are likely to survive the employment surprise for weekly gains driven by baking concerns and the prospect of a rate hike pause. Next week, investors will likely focus economic releases in inflation data and jobless news, due out on Wednesday and Thursday. |
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