Gold edges lower in quiet summer trading

(USAGOLD – 6/25/2020) – Gold edged lower today in quiet summer trading. It is down $3 on the day at $1759.  Silver is level at $17.89. The top-of-the-list concerns driving investor interest in gold remain the same – inflation, deflation, the success (or lack of success) of aggressive central bank policies, etc. Those who fear policymakers’ efforts will fall short worry about an outcome like the 1930s Great Depression. Those who think the money printing will revive moribund economies worry it will also create runaway inflation. Both camps have turned to gold for safe-haven purposes and, over the past few months, prices have pushed steadily higher as a result. As we close out another week of subdued price action, gold is up 24.9% over the past 12 months and silver is up 16.7%. The Dow Jones Industrial Average by way of contrast is down 3% over the same period.

Table of the Day

table showing gold ETF flows by country May 2020

Table courtesy of the World Gold Council

Table note:  The strong showing in gold ETF flows the first five months of the year is a reflection of continued interest in gold bullion among funds and institutions hedging an array of economic, financial, and geopolitical concerns. United States stockpiles were up 20.1% in May.  Also, note the strong interest in various European countries and Mainland China.  At 3510 metric tonnes, ETF stockpiles globally now exceed the official gold reserves of every nation on earth except the United States. (Funds and institutions are the primary market for gold ETFs. Individual investors generally opt for physical coins and bullion  for reasons explained by highly-regarded fund manager Jeff Gundlach here.)

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