Monday, February 29, 2016
Coin collectors who also have a penchant for superheroes can now chose from a new range of Batman and Superman coins produced to coincide with the forthcoming action movie.
The four Batman v Superman coins tie in with the Batman v Superman: Dawn of Justice film, which is released in March. The Royal Canadian Mint, which has produced the collectible coins, says they will be an “unforgettable series”.
There is just one gold coin in the series. Weighing in at 12 grams, the 14 carat $100 gold coin features an image of the two superheroes standing back to back. It’s set to become a collector’s item because just 3,000 are being made.
The $30 Batman v Superman two ounce silver coin is 99.99 per cent pure and shows an action scene of Batman, Superman and Wonder Woman. There will be a maximum of 7,000 of the coins minted.
The third coin is the Batman v Superman $30 Trinity silver coin, which also features the two superheroes and Wonder Woman. The coin weighs just over one troy ounce, and like the other silver coin, has a 99.99 per cent purity. There will be 12,500 of these coins produced for sale.
Finally, the collection is completed by a 25c 3D Batman v Superman edition, made from cupronickel. It features a hologram, which changes from Superman to Batman when it’s tilted. There will be 30,000 of the 13.7 gram coins produced.
The Royal Canadian Mint has produced a number of new coins already for 2016. As well as the superhero coins, it has designed a 7,500 run of four leaf clover silver coins which feature a green enamelled clover on the reverse.
The Royal Canadian Mint said: “There may only be a one in 10,000 chance of finding a four-leaf clover in an emerald field of shamrock, but with this beautiful enamel coin, the luck of the Irish is never far away.”
Thursday, February 25, 2016
The gold price reached almost £900 per troy ounce on Wednesday, nearing its highest point in almost a year.
At 15:15 yesterday (24 February) it stood at £897.33, up from £853.63 at 09:00 on Monday (22 February). This morning, gold cost £889.26 per troy ounce at 09:00.
Gold is offering its traditional safe haven for investors during choppy economic waters. Statistics released in the US this week showed the services sector shrank for the first time since late 2013, and disappointing house sales data was also published for January.
Although gold generally rises when the US dollar is weak, it gained strength yesterday while the dollar was performing well, although the currency lost value later in the day.
Jens Pedersen, senior analyst at Danske Bank, told Reuters yesterday: “Gold is rising on the back of weak risk appetite, but what stands out today (Wednesday) is that the market is rising even though the dollar is higher as well.”
Is gold a better safe haven that silver?
Investors seeking a safe haven for their cash generally turn to gold or silver. Of the two precious metals, gold is obviously the more expensive but is also often seen as a less volatile, and therefore a less risky investment than silver.
One of the reasons gold is thought to be a steadier choice is because silver is used more in industrial applications, so silver’s price is more dependent on the performance of the markets.
Russ Mould from broker AJ Bell told the Daily Telegraph: “Only 10 per cent to 15 per cent of gold demand comes from jewellery and industrial uses, while for silver this figure exceeds 50 per cent as it is used in areas such as batteries, LEDs, solar energy, dentistry and photography.
“Silver’s greater industrial use means it is more sensitive to the industrial cycle and potentially less of a haven than gold. This is also reflected in silver’s greater historic price volatility.”
Investing in gold bullion bars or gold or silver coins comes down to personal budgets and your own analysis of the market. As the old adage says: “You pays your money and makes your choice.”
Indian gold imports fall
India is set to record gold imports of around 25 tonnes this month, a two-year low for the world’s second biggest gold bullion buying nation.
It comes amid efforts by the Indian government to reduce its gold import duty costs, which stood at $36 billion last year.
Within the Indian market, demand for the precious metal has been subdued while consumers and jewellers wait to see whether the government will reduce the import tax in its budget at the end of the month. A similar dampening down of demand was seen ahead of the last budget, when the Indian government failed to reduce the duty.
The import duty was set at a record high of 10 per cent in 2010 as part of efforts to reduce the amount of gold flowing into India. However, this resulted in an upswing in smuggling; Reuters estimates that around 175 tonnes of gold were illegally brought into the country in 2014.
Wednesday, February 24, 2016
Efforts by the Indian government to reduce the country’s reliance on imports of gold appear to be having some knock-on effects.
Market analysts say that the country – the world’s second biggest buyer of the precious metal after China – will record a two-year import low of around 25 tonnes in February. The figure will be a welcome relief to the Indian government, which had to pay $36 billion in gold import costs last year.
Bachhraj Bamalwa, director at All India Gems and Jewellery Trade Federation, told Reuters: “Banks and trading agencies have scaled down imports. They are being forced to offer heavy discounts (to global prices) to clear inventory.
“Consumers are not sure about price trends. They are waiting for prices to stabilise before making purchases.”
The weaker demand from India could impact the current strong gold prices being seen on the world markets. The price of bullion is currently 15 per cent higher than it was at the start of the year and is enjoying its best sustained rally since August 2011.
However, Indian gold dealers are not benefiting from the high prices seen elsewhere and have been offering discounts in an effort to attract buyers. Analysts say that jewellers and retail buyers are biding their time to see whether the Indian government reduces the import duty on gold in the forthcoming budget at the end of the month. A similar drop in domestic gold prices was experienced before the country’s last budget, when the government did not meet the market’s expectation of a cut in duty.
India’s import duty for gold was set at 10 per cent in 2013 as it tried to reduce the amount of gold that was brought into the country. However, it had the effect of boosting smuggling and Reuters reported that around 175 tonnes of bullion were smuggled into India in 2014.
Monday, February 22, 2016
When looking for a safe haven investment, both gold and silver are popular choices. But which is the best choice during the current market volatility?
Gold is generally considered the number one safe haven investment, whether you are looking at bullion bars or coins, or buying into the precious metals futures markets.
Russ Mould from broker AJ Bell told the Daily Telegraph that gold can be less volatile than silver.
He said: “Only 10 per cent to 15 per cent of gold demand comes from jewellery and industrial uses, while for silver this figure exceeds 50 per cent as it is used in areas such as batteries, LEDs, solar energy, dentistry and photography.
“Silver’s greater industrial use means it is more sensitive to the industrial cycle and potentially less of a haven than gold. This is also reflected in silver’s greater historic price volatility.”
However, investing in silver is also worth considering. During the global economic downturn, the gold price jumped by 70 per cent between 2008 and 2010, but the value of silver doubled.
Since the start of this year, both silver and gold prices have performed well. Analysts say that although silver can potentially out-perform gold, it can be a more risky investment.
One method of deciding which precious metal to choose for your investment is to look at what’s called the gold-silver ratio – or how many ounces of silver are needed to buy one troy ounce of gold
The average ratio stands at around 55 although it has swung wildly over the years. The peak ratio recorded was almost 100 in 1991, compared to just 20 back in 1970.
Mr Mould said: “In the past 100 years the ratio has gone below 20 three times and neared 100 twice, so silver does look cheap relative to gold, although there is nothing to say gold cannot go higher still relative to silver, if history is any guide.”
Like any investment, remember the price of both gold and silver goes down as well as up and it’s down to personal choice which precious metal you go for.
Thursday, February 18, 2016
The gold price jumped midweek after falling back on Monday and Tuesday, as investors awaited publication of the US Federal Reserve’s minutes, and it remained stable after they were issued.
The minutes, from the US interest rate-setting body’s January meeting, said that members would continue to closely watch the performance of the global economy and revealed there had been discussions about halting the current policy of increasing the cost of borrowing. Although the minutes said that it was too early to change course, analysts believe that rate rises will not happen as quickly as seemed likely in December, when the US cost of borrowing was increased for the first time in almost a decade.
This is all good news for the strength of the gold price, which has already jumped around 14 per cent this year. It stood at £847.15 per troy ounce at 18:30 yesterday (Wednesday 17 February) and was slightly lower at £844.47 at 09:00 this morning (Thursday).
Natixis analyst Bernard Dahdah told Reuters: "The Fed rate hike most likely won't happen in March, and that for me is the most important driver behind the price of gold.
"Even if the wider markets improve slightly, as we've seen in the last few days, if people still believe the rate hike won't take place in March it will be hard to see gold prices continuing a downward movement.”
Strong gold demand forecast to continue
The strong international demand for gold from corporate and individual investors seen during 2015 is predicted to continue this year, according to the World Gold Council (WGC).
Its latest data, published in the new Gold Demand Trends, showed that high demand for the precious metal in the last six months of 2015 meant that 4,212 tonnes of gold were sold over the course of the year.
China, followed by India, remained the world’s biggest gold buying nation, while Chinese, European and US investors led the demand for gold bullion bars and coins.
WGC head of market intelligence, Alistair Hewitt, said: “Looking ahead, physical demand will continue to be supported by strong central bank purchases, and continued buying of jewellery, bars and coins by households across the world, led by India and China. If we just look at the year to date, the investment case for gold is as strong as ever. While stock markets have wobbled, gold has performed well.”
Latest Isle of Man Angel coins issued
In other news, the Isle of Man has launched its 2016 edition of the Angel gold bullion coin, continuing the series it started producing in 1984.
The coin, which features Queen Elizabeth II on one side and St Michael slaying a dragon on the other, is a legal tender with a fine gold purity of .999 that weighs in at one troy ounce.
Angel coins originated from France, where they were known as ange or angelot coins, and were believed to protect the holder against bad luck and poor health. They were said to be especially useful in guarding against ‘the King’s evil’, also known as scrofula, a glandular swelling in the neck.
Gold may not protect you from illness but it can help to protect your investments from the vagaries of the stock market and the effects of volatile international events.
Jeffrey Nichols of American Precious Metals Advisors told CNBC that he recommends his investors hold 10 to 15 per cent of their investable assets in bullion coins.
Wednesday, February 17, 2016
Demand for gold last year was on a par with the previous 12 months, with a strong second half making up for weaker demand in the first six months of 2015, according to statistics just published by the World Gold Council (WGC).
Its new Gold Demand Trends report found that “sustained buying” from central banks around the world - plus continued strong demand from China and India in the second half of the year – resulted in stable gold sales for 2016 as a whole.
Investors in China and Europe drove up sales of gold bullion coins and bars, with sales also strong in the US. The WGC said that financial and political tension, coupled with good value gold prices fuelled investor demand during the second half of the year. Globally, investment in the precious metal rose by eight per cent to 878 tonnes from 815 tonnes in 2014.
China remained the world’s biggest buyer of gold in 2015, snapping up 985 tonnes, an increase of two per cent on the year before. India was the second biggest international player in the market, buying 849 tonnes in total, a rise of one per cent on its 2014 total. The two countries combined were responsible for buying almost 45 per cent of the precious metal sold internationally.
Central banks slightly increased their annual demand for gold, buying in 588 tonnes compared to 584 tonnes the previous year. The WGC said that reduced confidence in the international economy and the falling price of oil drove demand.
WGC head of market intelligence, Alistair Hewitt, said: “In a year that saw global economic and stock market turmoil, the first US interest rate rise in nine years and falling oil prices, demand for gold remained resilient, coming in at 4,212 tonnes for the full year.
“Looking ahead, physical demand will continue to be supported by strong central bank purchases, and continued buying of jewellery, bars and coins by households across the world, led by India and China. If we just look at the year to date, the investment case for gold is as strong as ever. While stock markets have wobbled, gold has performed well.”
Monday, February 15, 2016
Gold bullion coin collecting is one of the best ways to invest in gold, and as we’ve reported in recent weeks, there have been a number of new coins issued already this year.
The Isle of Man is the latest to launch its new coin for 2016. The Angel bullion coin series started in 1984 and can be used as legal tender as well as being a valuable collectible.
On one side, the coin carries an image of Queen Elizabeth II, while the other features St Michael slaying a dragon. The 2016 Isle of Man Angel weighs 31.103g and has a fine gold purity of .999.
Angel coins have an interesting heritage. The English version, introduced by Edward IV in 1465, was based on the French ange or angelot coin which was named after the angel that appeared in the design. Traditionally, the coin was believed to bring good health and good luck and was given to sufferers of scrofula – known as ‘the King’s evil’ – a tuberculosis-type swelling of glands in the neck.
While possession of gold bullion coins may not keep modern collectors free from disease, choosing this form of gold investment is still considered a healthy way of building up individual stocks of the precious metal.
According to Jeffrey Nichols of American Precious Metals Advisors, buying physical gold you can hold in your hand remains a sensible option. He told CNBC this is “most liquid form of gold” and also has the benefit of being difficult to counterfeit. Mr Nichols recommended that investors have around 10 to 15 per cent of their investable assets in bullion coins.
Gold bullion coin collecting is an interesting hobby that can pay long-term dividends because as well as the value of the gold in the coin, the additional value that rare coins can command tends to increase over time.
Thursday, February 11, 2016
The gold price remained stable this week, as it enjoys a prolonged rally amid concerns about the global economy and specifically slowing growth in China.
Analysts were waiting for the US Federal Reserve’s chair to speak to Congress yesterday (Wednesday) to see what her remarks on the future direction of US interest rates might do to the value of the precious metal.
Janet Yellen told Congress that although there were more risks apparent in the international economy than when the Fed acted to increase the cost of borrowing in December last year – the first US rate hike in almost a decade – she saw no reason to reverse the current policy.
She said: "I think we want to be careful not to jump to a premature conclusion about what is in store for the US economy. I don't think it is going to be necessary to cut rates."
Although gold is seen as a safe investment in troubled economic times, her calming words did little to affect the demand for the precious metal. At 17:00 yesterday (10 February), gold was valued at £825.25 per troy ounce and this morning at 09:00, it had added another £20 to be valued at £845.19.
The gold price has remained strong despite the Chinese markets being closed for the Chinese New Year holiday.
How high will the gold price rise?
The value of gold has climbed by almost 10 per cent since the start of this year, and analysts are expecting further increases in the value of the precious metal.
Michael Widmer from BofA Merrill Lynch Global Research told CNBC that he expects the gold to reach a value of $1,250 per troy ounce – around £862 at current exchange rates – by December this year.
The rosy outlook has been echoed by numerous analysts, many of whom had previously taken a less than positive view that the gold price would continue to climb.
Carsten Menke, a commodities research analyst at Julius Baer, said in a note: "Due to prevailing risk aversion in financial markets and mounting global growth risks, a bearish outlook on gold is not warranted anymore.
"We have turned neutral and believe that investors should use gold as insurance in their portfolios."
New limited edition coins launched
Both the US Mint and the Royal Canadian Mint have launched some limited edition gold bullion and silver coins for collectors this month.
The US Mint and the Ronald Reagan Foundation are marking the 105th anniversary of the birth of the former Hollywood star and 40th US President by issuing the Ronald Reagan Presidential $1 Coin and Nancy Reagan First Spouse Coin. The Mint has been producing coins featuring past presidents since 2007.
In Canada, the coins are wilder in nature. The 99.999 per cent purity, one troy ounce 2016 Roaring Grizzly Gold Coin is the latest addition to the Call of the Wild series.
The Royal Canadian Mint is also issuing four silver coins in the Predator series, which will each feature a different Canadian animal of prey. The first, which has a limited one million coin run, is decorated with the image of a leaping cougar.
Monday, February 1, 2016
The gold price ended January almost five per cent higher than it started the year, after turmoil in the international stock markets sent investors heading for a safe haven for their cash.
The turnaround in gold’s fortunes, leading the precious metal to its biggest monthly gain in a year, coincided with a 7.4 per cent fall in the value of US equities, the biggest drop since 2010. Gold’s value has increased after it fell to six-year lows in November and December 2015.
Whether gold can continue its strong performance will depend on outside influences, according to analysts. Economic figures from China are expected to play a key role in how investors use their money, with evidence of a slowdown as seen during January likely to benefit the value of the precious metal.
Feifei Li, analyst at Barclays, said in a note: “If a hard landing scenario for China were to materialise, it would likely spur safe haven demand, and could potentially prompt the Fed to reverse its tightening policy.
“On the other hand, a quick recovery in China may lead to greater risk appetite and continued rate hiking in the US.”
Last week, the Fed left interest rates on hold following December’s 0.25 per cent increase. Increasing the cost of borrowing generally happens when the economy is expanding and after the events of January in the markets, analysts are less inclined to bet on a further rise being imminent. The vote among rate-setters to leave the cost of borrowing on hold at the January meeting was unanimous.
While this is a positive for the value of gold, further poor economic news from China could also see the price of the precious metal rise further.
Gold started 2016 at £719.99 per troy ounce at 12.30pm on January 1 and had increased to £784.90 at 22.30 on Friday (29 January), where it remained until the markets opened this morning (Monday). Gold was valued at £785.15 per troy ounce at 09:00 today.