ANZ: Gold on “Solid Footing”

Release Date: 
Friday, December 19, 2014

Gold and Silver Prices

Gold prices and silver prices moved lower this week.  “Gold edged lower on Friday, struggling with the $1,200 an ounce mark as the dollar firmed and investor appetite for risk increased on expectations of rising U.S. interest rates…The Fed, after wrapping up a two-day meeting on Wednesday, signaled it was on track to increase rates next year but said it was taking a patient stance, keeping gold's losses in check.”  (“Gold below $1,200/oz on dollar, shares; heads for weekly loss,” Reuters, 12/19/14.)

Gold finished the week down $27.60, closing at $1,195.20. Silver prices closed the week at $16.17, down $0.97.

ANZ:  Gold on “Solid Footing”

One of Australia’s largest banks sees higher gold prices in 2014 and 2015.

“Gold prices will recover next year as demand in China and India improves, according to Australia & New Zealand Banking Group Ltd., which forecast an advance for bullion even as the Federal Reserve raises interest rates.  The precious metal will climb to $1,280 an ounce by the end of 2015, rising each quarter, strategists Victor Thianpiriya and Mark Pervan wrote in an e-mailed report dated Dec. 17. The forecast for end-2016 is $1,420, according to the report…Demand will improve after India removed restrictions on imports last month and as sales in China increase, according to ANZ.  ‘Physical gold demand in China and India were held back in 2014 amid high stocks and import controls, respectively,’ the bank said, referring to the world’s two largest bullion consumers. ‘Both these shackles have been removed, putting demand on a solid footing as we head into 2015.’”  (“Fed Won’t Stop Gold’s Recovery in ‘15, ANZ Says as Asia Buys” Bloomberg, 12/17/14.)

Rickards: I Would Invest 20% of My Investment Dollars into Gold for 2015

Financial author and Senior Global Strategist at West Shore Funds, Jim Rickards, discussed how he would allocate $100,000 in 2015. 

“On how he would invest $100,000 in 2015…‘I would have some inflation hedges and some deflation hedges’, says Rickards…$20,000 in gold.  ‘Normally, I’d recommend lower maybe 10%, but I like this entry point. I think this is a good place you can maybe pick up a little.’” (“Just Like The Fed, Rickards Recommends Patience,” Kitco News, 12/19/14.)

HSBC: Swiss Negative Interest Rates Positive for Gold

The Swiss National Bank’s plan to introduce a negative deposit interest rate may be positive for gold.   

“The Swiss National Bank’s surprise announcement Thursday to introduce a negative deposit rate could help gold prices down the road, according to analysts from HSBC.  According to the central bank’s press release, it will charge 0.25% ‘on sight deposit account balances at the SNBS.’”

“In a research note published Thursday afternoon, analysts at HSBC said that the introduction of negative interest rates, which is now in-line with the ECB’s monetary policy, could make the Swiss franc less attractive as a ‘safe-haven’ currency.  'This could have real implications for gold prices,’ they said in the report. ‘If investors…find that the CHF no longer looks so attractive based on SNB actions, then investors may shift to other perceived hard assets. Gold would certainly count as one of these assets.’”  (“Swiss Negative Deposit Rate Could Help Gold Prices – HSBC,” Kitco News, 12/19/14.)

Russian Ruble Crashes

The Russian ruble fell dramatically this week raising concerns Russia may be forced to impose Soviet era capital controls. 

“Russia has lost control of its economy and may be forced to impose Soviet-style exchange controls after ‘shock and awe’ action by the central bank failed to stem the collapse of the rouble.  ‘The situation is critical,’ said the central bank’s vice-chairman, Sergei Shvetsov.  ‘What is happening is a nightmare that we could not even have imagined a year ago.’  The currency crashed to 100 against the euro in the biggest one-day drop since the default crisis in 1998 as capital flight gathered pace, despite a drastic rise in interest rates to 17pc intended to crush speculators and show resolve.”

“After years of bluster and suggestions by Mr. Putin that the US is a paper tiger, the Kremlin is now coming face to face with the cataclysmic consequences of what it has done by invading Ukraine and changing Europe's borders by force. By the same token, Washington needs to move with care since it would be a geostrategic miscalculation of the first order to push a nuclear-armed Russia too far into a corner, or to [perpetuate] a cycle of grievance.”

“‘A Russian downgrade to junk is only a matter [of] time,’ said Tim Ash, from Standard Bank.”  (“Russia risks Soviet-style collapse as rouble defence fails,” Telegraph, 12/16/14.)

A December You’ll Remember—Call Now for Special Year-End Offers

While you search for the perfect gift for everyone on your list, Goldline is keeping you in mind with our year-end specials. This December, when you open a self-directed IRA with Goldline’s Express IRA® program, Goldline will cover your IRA fees for the first two years with free additional limited production bullion coins.* And, with every qualifying purchase of $10,000 or more of limited production, exclusive bullion coins, you will receive a $200 gift card to a popular national retailer.

In a season of giving, we strive to give a little more.

Call 866-867-4466 to learn more about Goldline’s December specials.

Limits and conditions:
• Limited time offer – qualifying purchases must be confirmed no later than December 31, 2014 at 6pm PST.
• This offer is not available to current or former Goldline employees. This offer may not be combined with Goldline’s Price Guarantee Programs or Price Shield℠.

*Coins are valued at their ask price

*Federal IRA tax laws are complex and may change from year to year. Goldline believes it is appropriate to have 5%-20% of retirement portfolio allocated to precious metals. Other individuals and institutions may recommend different percentages. As with any investment, you should consult your tax advisor before making a decision regarding precious metals IRA investments.

Goldline provides a wrap-up of the week's precious metals news along with important commentary on the American Advisor Week in Review audio program.

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†This material has been prepared for private use. Although the information in this commentary has been obtained from sources believed to be reliable, Goldline does not guarantee its accuracy and such information may be incomplete or condensed. The opinions expressed are subject to change without notice.

You should review Goldine's Account Agreement along with our risk disclosure booklet, Coin Facts for Investors and Collectors to Consider ®, prior to making your purchase. Goldline has a spread or price difference between our selling price, called the "ask", and our buy-back price, called the "bid". That spread varies depending on coin or bar you acquire. Spreads on 1 oz bullion coins, 90% silver dimes and quarters, and one ounce and larger bullion bars are 13%. All other coins have a spread of 28%. There is also a 1% liquidation fee when you sell your coins back to Goldline. The market must go up enough to overcome this spread before an actual profit is achieved. Precious metals and rare coins can increase or decrease in value. Past performance does not guarantee future results. Coins are a long-term, three- to five-year, preferably five- to ten-year investment. We believe precious metals are suitable for 5% to 20% of the average investment portfolio though others may recommend a different percentage.

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