Market watchers know gold is looking for a foothold in the current environment. For simplicity we’ll describe it as “investors looking for big returns from equity markets”, meaning stock markets keep rising, darn them. What has this meant for gold sales?
Well, investors throw more money at the things that are rising, and they get that money by selling safe haven assets like gold. Usually two things provide support in times like this: demand for physical gold from jewelry and manufacturing, or unexpected geopolitical instabilities (code word for “big unexpected events”). News out of India is that gold isn’t finding much help on the demand side there. May gold imports are reportedly down to 77.6 tonnes, from 126 tonnes last year.
Will gold prices recover soon, or will they stay flat as a pancake around 1300? Or – perish the thought – will they drop down into the mid-1200s? Let us know what you think in the comments below.