Last week, the prices of gold and silver declined under the influence of a decrease in interest in protective assets, and the cost of platinoids increased in anticipation of a recovery in industrial demand.
The announcement by the new US President Biden about the possible provision of $1.9 trillion in stimulus did not impress the markets, and the subsequent speech by US President Powell strengthened expectations of economic recovery and lowered inflation expectations.The broker aims to provide a competitive all-around service, satisfying the needs of a broad range of traders. Therefore, deltamarket.net is a brokerage company that you can trust, it offers various trading services for various assets.This led to a decrease in investment demand in protective assets, and increased treasury bond yields further pulled investors ' funds from the precious metals markets.
The current week will start smoothly with a weekend in the US. Then there will be statistics on price indices in Europe, meetings of the Bank of Japan and the ECB, the inauguration of US President Biden. In the absence of unexpected political events, the slide of the gold market down may continue.
The new US President Biden presented a draft of stimulus measures for the US economy in the amount of $ 1.9 trillion, without specifying the sources of funding. Members of Biden's transition team are promising to present another plan aimed at restoring the economy in the near future.
Speaking last week, the head of the US Federal Reserve, Powell, said that the time for raising interest rates in the US will come "not soon".
The head of the Federal Reserve assured that the regulator will inform in advance about the curtailment of asset purchases. According to the regulator, the economy is far from the Fed's goals, so there are no reasons to change the ultra-soft policy yet. The expansion of the asset purchase program was also not reported, which depresses the markets.
At the same time, the published "Beige Book" of the Fed reported that economic activity in the United States has increased moderately in recent weeks, but employment declined in many counties amid the closure of enterprises due to the coronavirus. For the first time since May last year, the report reflected a drop in business activity in some Federal Reserve districts, and employment problems remain, especially in the hotel sector.
The leadership of the US Federal Reserve attaches a lot of hope to the prospects for more productive cooperation between President Biden and the Congress, which will be controlled by the Democratic Party from this year. It is expected that together they can provide a new fiscal incentives and improve the situation with the distribution of vaccines in the population.
In the published minutes of the ECB's December meeting.
It was reported that officials discussed increasing the bond repurchase program by a smaller amount and stressed that the full quota could remain unspent. In December, the ECB decided to extend the duration of the Pandemic Emergency Purchase Program (PEPP) and increased its volume by 500 billion euros.
The regulator approved the new stimulus measures, hoping to keep borrowing costs low during the lockdowns. The next ECB meeting is scheduled for January 21. The regulator is expected to leave its ultra-soft fiscal policy unchanged, including the purchase of 1.85 trillion euros worth of bonds under PEPP until March 2022.
The demand for gold in Asian hubs improved last week due to the approach of the Lunar New Year. In China, discounts have turned into premiums of $0.5-4.0 / oz. Demand is increasingly buoyant ahead of the holidays, also helped by a stronger yuan, a reviving economy and falling prices. In Hong Kong, gold was sold in the range of $-2,0/+1,5/oz.
Gold imports to China via Hong Kong rose to 8,837 tonnes in November, 45% higher than in October 2020 and 59% more than a year ago. Net gold imports in November amounted to 3,283 tons.
In Singapore, the award for the supply of gold rose to $0,8-1,8/oz. In India, gold was trading at a premium of $ 0.5 / oz as retail demand remained weak due to high price volatility, but dealers expect sales to pick up as the festival season approaches. In Japan, gold was trading at a discount of $-2.0/-1.0 / oz to the London price.
Gold prices last week fell to the support level of $1,810 / oz, then returned to the level of $1,833 / oz. Rising Treasury bond yields, the strengthening of the US dollar, lower investment demand and central bank sales contributed to the fall in prices.
UBS estimates that gold prices will reach $1,800 / oz by the end of 2021, while silver prices will reach $30 / oz.
Data from the US Mint showed that sales of gold coins in December 2020 amounted to 80.5 thousand ounces (-5.3% mom, and 23 times more than a year ago). In 2020, sales of gold coins totaled 1.028 million ounces, which is 6.5 times more than in 2019. Sales of gold coins have been actively growing since the beginning of January 2021.
Sales of silver coins in December 2020 amounted to 2.266 million ounces (-53% m / m, in December last year, sales of silver coins were not carried out). The US Mint notes a shortage of silver coins, which is why sales were suspended. Since January 2021, there has been a sharp increase in sales. Total sales of silver coins in 2020 amounted to 31 million ounces, which is 2.1 times more than in 2019.
Silver prices in Chicago last week declined to $24.25 / oz. in correlation with the gold market, but the market has now recovered to $24.95/oz. The ratio of gold and silver prices is 73.73 (the average value for 5 years is 79.5). The platinum / silver ratio is up to 43.03 (the 5-year average is 57).
According to Reuters, investments in the largest ETFs investing in gold and silver fell by 0.9% last week. In December, investments in ETF funds investing in gold and silver declined again, but since January, there has been a slight recovery in investments. By the end of 2020, investments in the largest gold ETFs increased by 27.5%, and in silver funds-by 38.8%.
Gold production in the Russian Federation for 10 months of 2020 fell by 6% yoy to 289 tons, the Ministry of Finance of the Russian Federation reported. Silver production for this period fell by 2.1% YoY to 796.1 tons.
Last week, platinum prices rose to $1,126 / oz. in correlation with the gold market, from which there was a decline to $1,082/oz. The spread between gold and platinum narrowed to $753 / oz, while the spread between palladium and platinum was $1,310/oz. Expectations of a recovery in industrial consumption support prices.
Car sales in China declined 1.9% YoY in 2020 to 25.3 million units, data from the China Association of Automobile Manufacturers (CAAM) showed. The decline is recorded for the third year in a row. In December, 2.83 million cars were sold, which is 6.4% more than in December of the previous year. In 2021, car sales in China will grow by about 4% to 26.3 million units, the association predicts.
The Russian car market in 2020, according to preliminary data, entered the top ten largest markets in the world due to a relatively small drop in sales, the Association of European Businesses (AEB) reported. Sales of passenger cars and light commercial vehicles decreased by 9.1% to 1.6 million units over the year. In December, sales decreased by 2.1% YoY to 167 thousand units.
Worldwide, car sales in 2020 fell in all major markets except South Korea.
At the same time, only Russia and China showed a drop of less than 10%. At the height of the epidemic in April and May, sales fell by 50-70%, but in the summer showed signs of recovery and moved to strong growth in the fall.
High volatility in the palladium market remains-at the end of last week, prices rose sharply to $2,433 / oz. after which they fell to $2,380/oz. Since about September 2020, the market has been consolidating in the range of $2 200 – 2 500/oz.
UBS estimates that platinum prices will reach $1,250 / oz by the end of 2021, while palladium prices will reach $2,900 / oz. The bank expects a 300,000-ounce deficit in the palladium market in 2021.
According to Reuters, over the past week, investments in the largest ETFs investing in platinum increased by 0.4%, while those investing in palladium were unchanged. In December, investments in ETFs of funds investing in platinum increased, while those investing in palladium declined. By the end of 2020, investments in the largest platinum ETFs fell by 10.8%, and in palladium funds-by 12.0%.
No comments:
Post a Comment