Metals Minute 169: Golden Inflation Hedge
We have mixed numbers this morning from a week ago, with gold down 1% to $1,813, silver down 1% to $23.98, platinum 2% higher at $1,052, and palladium up 6% to $1,869.
From a year ago today, we have gold up a fraction, silver up 4%, platinum up 7%, and palladium off 7%.
Gold moved to a 6-month high on Tuesday, on news that China is reducing Covid restrictions and reopening their economy.
Russia’s largest bank, Sberbank, has issued a gold-backed digital financial asset (DFA), with the target market being corporate treasury accounts. This is an instance where it isn’t DFA’s or gold, but DFA’s AND gold.
Traditional gold bear JC Parets has abandoned the bearish position on gold, and is calling for $5,000/oz gold “sooner than most expect”. He cites gold’s strength during recent downturns, and notes that gold hedgers (jewelers, etc) are reducing hedged positions, which will allow gold to climb with less resistance. He believes silver will do well also.
Those looking to bonds to predict inflation have been disappointed, while gold has done a great job predicting the inflation we now see. Gold has risen 42% in 4 years, protecting investors from the 18% inflation that occurred.