Gold and silver prices dipped early last week after broad stock market indexes had reached record highs, but then the metals advanced sharply and ended higher as equity markets faltered amid new credit market fears, this time concerning the health of Portugal’s biggest bank. This marked the sixth straight week of gains for precious metals that are now at 3.5 month highs despite recent sharp declines for most other commodity prices.
Though safe haven demand from a number of different sources (a list that seems to grow every week) has been the key driver behind rising gold and silver futures market buying, the big gains turned in by mining stocks so far this year are also being credited for some of the metals’ strength.
The silver rally has been particularly impressive as the “poor man’s gold” has risen 15 percent in just the last six weeks.
India and China remain non-factors for metals markets this summer and this is likely to continue over the near-term as the new Indian government chose not to reduce gold import duties and inquiries into commodity financing deals cast doubt over China’s gold demand. But quickly approaching seasonally strong periods of the year for both of the world’s top two gold buyers should prompt physical buying in Asia.
After surging in February and then faltering in the spring, precious metals are now again in strong short-term uptrends, seemingly determined to…