Gold panned despite stellar performance.
Despite gold’s stellar performance so far this year, The Financial Times chose to headline a front page article “Gold loses shine as Fed decision looms.” In the Commodities Section, a second piece was titled “Gold heads for monthly drop after investors turn anxious over rate rise and weaker demand.” Regardless gold’s performance, the establishment media never misses a chance to denigrate it.
Buried in the articles were admissions gold is up 26% so far this year and that it was off only 0.9% when the article was written. For the record, gold’s high this year was $1,339.82 and is now trading at $1,322, down only 1.3%. Gold is going through a mere fluctuation, not declining.
Both articles noted apprehension about a possible Fed interest rate hike and that much attention will be given to Fed Chair Janet Yellen’s comments tomorrow when she speaks at the Fed’s annual confab in Jackson Hole, WY. A rate hike will — supposedly — make interest bearing instruments more attractive to investors, causing them to move from gold, which they bought heavily the first half of this year.
Also noted was that in July exports of gold from Swiss refineries to India and China declined 76% (supposedly from June’s exports). To the Times, this suggests a change in buying from Asia. However, one robin does not a Spring make.
India and China account for roughly half the world’s gold demand, the peak season for buying gold in India and China starts in October. That’s prior to the national holidays in China and marks the beginning of the festive season in India, which people consider to be a great time to buy gold and silver.