Dealing Desk: Market Worries see Precious Metals Retreat below Psychological Levels

This week, clients have been net buying gold, silver and palladium whilst selling platinum.

We have seen more buying activity since Tuesday as many clients have been bargain hunting after the large drop in price. As the price has continued to lower throughout the day, more clients are now purchasing and taking advantage of the low prices. Goldmoney Wealth’s clients have favoured the Hong Kong and Singapore vaults followed by the Canadian vault with less preference being shown for the London and Swiss vaults.

Kelly-Ann Kearsey, Dealing Manager at Goldmoney Wealth said that last week saw the gold and silver prices begin to retreat due to a stronger US dollar as well as the US presidential debates. This week has continued much in the same way, the gold price fell below the psychological level of $1,300/oz on Tuesday, dropping 3.3%, which was the first time it had traded at this level since the Brexit vote in June. Meanwhile, silver posted the largest price drop in a day since January 2015.

The price drop can be linked to the concerns that central banks are ready to curb stimulus together with the ongoing worry that the Fed may be set to raise interest rates in December for the first time in 12 months as the US economy improves.

The chance of a Fed hike in December has now increased to 62% probability, whereas last week the level was at 54%.

Thursday afternoon also saw the release of the weekly US jobless claims where the figure releases were better than expected. On Friday, we are also expecting the release of the US Employment Situation figures which in turn has caused the gold and silver price to diminish further throughout the afternoon to a spot low of USD1,251.68/oz.

Week on week, gold decreased the least of all metals; however, platinum has now also fallen back below the $1,000oz level. This has amended the gold to silver ratio up to 72.

06/10/16 16:00. Gold decreased 5.1% to $1,251.69, Silver dropped 9.8% to $17.18, Platinum lost 5.4% to $965.20 and Palladium retreated 6.8% to $712.20 Gold/Silver ratio: 72

NOTES TO EDITOR
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Goldmoney
Goldmoney is one of the world’s leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.
Through Goldmoney’s non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. Goldmoney partners with Brink’s, Loomis International (formerly Via Mat), Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.
Goldmoney currently has over 25,000 customers worldwide and holds over $1.6 billion of precious metals in its partner vaults.
Goldmoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. Goldmoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

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