Swann Global was delighted to be invited by Metals Focus, the independent precious-metals research house, to attend the launch in London of its annual review of the gold market. The publication, “Gold Focus 2017” provides an in-depth analysis of key developments in the market, including historical and forward-looking statistics. The report looks at all areas of global gold supply and demand, and features annual data on a country-by-country basis. Copies can be ordered from Metals Focus’ website, https://www.metalsfocus.com/annual-gold-focus
With regard to some of the key factors behind the recent slump in gold prices, keynote speaker Philip Newman pointed to a downturn in demand from Chinese and Indian markets, along with tepid central bank policies as prominent factors towards gold’s depreciation. A particular focus was given to current monetary policies pursued by the Indian government. Recent demonetisation policies, a proposed excise tax of 1% on gold and subsequent strikes by major jewellers have impacted global demand.
Despite prices hovering around USD 1250/oz, the long-term outlook, according to Mr. Newman, looks more promising. Metals Focus’ medium-term forecasts include a steady price-range of circa USD 1285/oz. Mr. Newman went as far to predict a long-term high of USD 1475/oz. Mr. Newman attributed the positive price rise to greater geopolitical uncertainty, resulting in higher paper-based trading via ETFs and investors. Recent examples include the failure in passing signature healthcare reform bills through the republican-controlled U.S congress, an unclear Trump agenda, French and German elections as well as Brexit.
The different challenges facing the fundaments of physical supply and demand for gold production, and the volatility associated with high-volume electronic trading by ETFs, investment funds and speculators, will ensure that 2017 will remain an exciting market for Gold Bulls and Bears alike.