Gold Getting Boost from Japan Spend/Lend Stimulus
$GLD, $SLV, $ABX, $KGC
“Gold is getting another boost, this time from Japan PM Shinzo Abe”
Gold prices are headed for the longest rally in more than 6 weeks after Japan’s cabinet Tuesday approved a spending/lending stimulus package, including JPY4.6-T in outlays this year.
The USD also weakened, boosting the appeal of the precious Yellow metal as an alternative investment.
Bullion futures have rallied 29% YTD on growing speculation that central banks including the US Fed will be slow to raise interest rates. Investors chased better returns in precious metals as monetary policies from Japan to Europe push yields on about $9-T of sovereign bonds in developed markets below Zero.
Gold futures for December delivery gained 1% to settle at 1,372.60 oz at 1:53p EDT on the COMEX in New York, a 6th straight advance in the longest run since 16 June
Producers are positive on prices. Fresnillo Plc, the biggest primary Silver producer, says gains for precious metals will be sustained, while Australian Gold miner Northern Star Resources Ltd.’s Bill Beament sees a longer-term uptrend.
A Bloomberg Intelligence gauge of 14 senior global gold producers advanced 2.9% to the highest since Y 2013. Kinross Gold Corp. (NYSE:KGC) and Barrick Gold Corp. (NYSE:ABX) were among the biggest gainers.
Holdings in ETF’s (exchange-traded funds) backed by Gold added 8.4 tonnes to 2,016.1 tonnes Monday, the highest since July 2013.