Silver and gold value marches towards record
The price of silver has jumped to the highest level since 2013 whilst gold nears record amid COVID-19.
Investors are currently flocking to a number of precious metals as demand continues to surge as coronavirus cases continue to increase in many nations across the world, which has forced real interest rates in the US to plummet and the economy to shrink.
Holdings in exchange-traded funds backed by silver and gold have hit an all-time high thanks to the increases.
Silver is used widely in manufactured products including solar panels and various electronics and has got a major boost from bets on a return of full industrial demand and concerns surrounding the supply of the metal.
Vivek Dhar, an analysts about Commonwealth Bank of Australia, said: “Like gold, silver has benefited this year from safe haven demand and falling long term US real yields”.
Dhar then went on to say: “Low yields ultimately boost the appeal of non‑interest bearing assets like precious metals. A sustained rally in silver can continue, particularly when demand hopes and supply concerns are added to the mix.”
The price of spot silver increased by as much as 6%, reaching a value of $22.5821 an ounce. This is the highest figure the metal has seen since 2013. Futures on the Comex climbed by 6.5%.
Gold for immediate delivery went up by 0.3% to the value of $1847.52 by the ounce. This is the highest price the precious metal has been in almost nine years, and the price continues to close the gap between the all-time high which stands at $1,921.17 which was set in September 2011.
In a note, Chief Precious Metals Analyst at HSBC Securities (USA) Inc., James Steel, said: “Silver is surging, and we think it is likely to remain strong. Some investors who may not have participated fully in the gold rally could find silver attractive. We believe this is happening and may sustain silver at higher prices still.”
Newmont acquires Canada’s GT Gold in $325mn deal
Newmont, the world’s biggest gold miner, has acquired Canada’s GT Gold in a deal worth $325mn. The gold giant now controls the Tatogga gold-copper project in the Traditional Territory of the Tahltan Nation.
“With the acquisition of GT Gold and the Tatogga project in the highly sought-after Golden Triangle district of British Columbia, Canada, Newmont continues to strengthen our world-class portfolio,” commented Newmont President and CEO Tom Palmer.
“We look forward to continuing to build a respectful and meaningful relationship with the Tahltan Nation, including the community of Iskut. The relationships we have with Indigenous communities, First Nations and host communities are critical to the way we operate. We will partner with the Tahltan Nation at all levels, and with the Government of British Columbia to ensure a shared path forward as the Company understands and acknowledges that Tahltan consent is necessary for advancing the Tatogga project.”
Newmont’s acquisition includes the Tatogga project, comprised primarily of the Saddle North deposit, which has the potential to contribute future significant gold and copper annual production. There are also further exploration opportunities beyond the known deposits at Saddle North within the land package. The Tatogga project adds to Newmont’s existing interest in the prospective Golden Triangle through the company’s 50% ownership in the Galore Creek project.
Newmont is the world’s leading gold company and a producer of copper, silver, zinc and lead. A world-class portfolio of assets, prospects and talent is anchored in favourable mining jurisdictions in North America, South America, Australia and Africa. The American miner is celebrating its 100th anniversary this month.
With gold prices on the rise, the last six months has seen gold industry M&A activity accelerating. A recent Mckinsey report, advises that the industry need to be mindful of mistakes made during the previous gold price boom, when growth was chased unidirectionally by several companies.