Market Update GoldCore 19 June

Market Update GoldCore

U.S. Mint Sales of Silver Coins Reach Record in 2013 First Half

Today’s AM fix was USD 1,366.00, EUR 1,019.86 and GBP 874.91 per ounce.
Yesterday’s AM fix was USD 1,378.50, EUR 1,030.35 and GBP 880.32 per ounce.

Gold fell $16.60 or 1.2% yesterday and closed at $1,367.10/oz. Silver finished down 1.01%.

Gold’s weakness continues and gold is now near the lowest level in four weeks, as a liquidity driven rally in stocks and investor caution over the Federal Reserve’s monetary policy is contributing to a nervous gold market.

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Fed Chairman Ben Bernanke said last month the bank could scale back its $85 billion monthly bond purchases if the U.S. economy strengthens, but a lack of clarity on the timing has unsettled markets. A policy statement from the central bank will be released today after its meeting.

Expectations are that the Fed may scale back its extremely unusual $85 billion per month debt monetisation programme to $60 billion a month and continue with near zero interest rates. Both of which would be bullish for gold.

Sales of silver coins by the U.S. Mint have set a record high in the first half of 2013 seeing the best start to a year ever. Silver bullion coins were first offered in 1986.

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Falling prices and concerns about being able to take delivery of coins amid continuing concerns about the US economy and currency debasement have led to the record demand.

The parabolic spike in 1980 led to the gold silver ratio collapsing to 17 to 1 ($850 oz / $50 oz). We expect a similar outperformance and parabolic final price move in silver and it is likely that the gold silver ratio will revert to its long term historical average, seen throughout much of history, below 20 to 1.

Silver remains gold’s very poor cousin and gets little or no media attention. Silver’s inflation adjusted high was $130/oz and we continue to see that as a realistic long term price target. Given silver’s volatility, dollar, pound or euro cost averaging into position remains prudent.

News From Around The World

Kyle Bass: "Denial" Is Extremely Popular in the Financial Markets   You Tube

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Are Commodity Prices About To Explode?   MarketWatch

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