Gold Price Shows Renewed Strength

Today, Tuesday, October 18, gold’s closing spot price is $1,261 per ounce, up $6.00 – $9.00 intra-day. A volatile dollar is supporting gold after its biggest drop in price in fifteen months on rumors of the possibility of a Fed rate hike this coming December.
Gold is holding just below the 200-day moving average. A break above that significant technical level will prove an important bullish indicator for the shiny metal. Although the CME Group’s Fedwatch program predicts a 70% chance of a Fed rate hike in December, downward pressure on gold has eased up on the increased odds of Hillary Clinton winning the election.
Her proposed social policies are widely perceived as expansive to our nation’s federal deficit – a scenario that will eventually debase the U.S. dollar.
Also, gold holdings in ETFs at 57.433 million ounces are up over 2 percent since September 15. A Reuters survey of delegates at a conference in Singapore portrays an increase in gold prices to nearly $1,350 by October 2017 due to greater physical demand. If weakness in the global economy persists, this demand by investors in search of a safe haven is likely to continue.
Monsoon rains in India are also now supporting higher gold prices. When the rains come, demand for gold jewelry spikes, because farmers find themselves with greater income. And India just had its best monsoon season in three years. Farmers’ purchases comprise a third of India’s gold jewelry consumption. At 23,000 metric tons, Indian households can boast the world’s largest private gold holdings.
Given the fact that Indians will spend between 35 and 40% of their wedding expenses on gold jewelry, they could wind up spending nearly $10 billion on gold alone this coming wedding season, which runs from October through December.
Indians are shrewd gold buyers. When its price drops, as it has recently, they take advantage of a buying opportunity. Unlike investors here in the States they don’t hesitate out of fear of a bear market. A survey conducted in 2013 by the Federation of Indian Chambers of Commerce & Industry (FICCI) reveals that three quarters of Indians consider gold a “safe investment”.
Can we learn something about investing from Indians and their intimate and historic relationship with gold? I think so. If we make it our business to acquire gold on a price decline, our personal wealth stands only to increase when the market turns around.
For more information, call 800-777-6177 now, and ask to speak to a Fortress Gold Group representative.

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