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Precious Metals Fall as Demand Wanes

November 16, 2012 at 5:58 by Vladimir Vyun

Precious metals dropped on signs that global demand is waning while supply may pick up. The World Gold Council reported that world consumption of gold dropped 11 percent in the third quarter of this year from a year ago. Demand in China (the second biggest consumer in the world) fell 8 percent. The report was not completely bad though as it said that “the Indian market is showing signs of recovery”, growing 9 percent, and demand from central banks increased.

At the same time, Anglo American Platinum Ltd. reported that it reached an agreement about wages with striking workers. Such outcome means that production will resume, adding supply to the market.

Gold slipped from $1,724.88 to $1,711.73 per troy ounce on COMEX yesterday and traded at $1,713.33 today. Silver was at about $32.46 per ounce today after yesterday’s drop from $32.57 to $32.38. Platinum fell from $1,579.25 to $1,554.25 per ounce before trading at $1,557.25. Palladium traded near $625.95 per ounce after falling from $631.70 to $624.25.

If you have any questions and comments on the commodities today, use the form below to reply.

3 Responses to “Precious Metals Fall as Demand Wanes”

  1. Jimmy H

    I wouldn’t worry too much about the short term fluctuations in the metals. The long term Outlook remains ultra bullish, so unless you’re day trading the swings , the real play is to buy physical bullion and hold on tight as volatility will certainly ramp up.

    [Reply]

    enivid Reply:

    In addition to its investment risks, holding physical gold involves additional costs (storage). If I were bullish on gold, I would go for some diversified portfolio of gold-mining stocks.

    [Reply]

  2. Jimmy H.

    enivid:

    There are definitely risks associated with every investment, but when I talk about physical gold and silver I must preach to take delivery. If you don’t hold it, you don’t own it. As far as gold-mining stocks, I love this sector as a potion of anyone’s investment portfolio. Be aware of the fact that not all mining companies will profit as the PM’s rise. I’ve written a little article on mining stocks vs physical bullion on my website that might interest you.

    Thanks and keep up the good work.

    [Reply]

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