A Surge in Silver Eagle Demand

Cassie Bastien

9/1/2017 8:50:50 AM

Daily Gold & Silver Market Report – 09/01/2017

Although sales have been much weaker in recent months, SilverSeek's Steve St. Angelo says that most investors still believe in obtaining Silver in times of uncertainty surrounding all markets. St. Angelo says that “Silver Eagle sales for Jan-Aug 2017 are nearly 50 percent lower than they were during the same period last year.” He feels that much of this is due to geopolitical concerns surrounding Washington. To further explain, after worry surrounding the North Korean nuclear threat, flooding in Houston, Texas and the U.S. debt ceiling issue over the past week, SilverSeek reports that the U.S. Mint sold 600,000 Silver Eagles in two days, quickly surpassing the 425,000 four-week total (August 1st-25th). Furthermore, recent sales numbers show that the Silver to Gold Eagles sales ratio is now 108 to 1, according to St. Angelo. Additional support for the price of Silver and Gold could come from the September U.S. debt ceiling debate, as well as movement in the stock market.

Gold Prices Surge 4% in August

According to FactSet data, the most-active contract’s 4 percent August climb was the largest monthly gain for the price of Gold since January. Analysts have determined that the support of Gold was found in geopolitical concerns, movement within the dollar and short coverage (traders who sold futures contracts in a bet that prices would fall, then bought them back to close out position). Amongst all of these contributors, it was the job report that brought light to the yellow metal's shine. Charalambos Pissouros, senior analyst with IronFX said, “Following the strong upside revision of Q2 GDP and the robust ADP [private-sector hiring] print, another set of encouraging data could push higher the probability for another Fed hike this year.” He said, “…a strong rebound in inflation is needed before rate-hike expectations rise materially and help the dollar reverse its latest downtrend.” Nevertheless, Marketwatch news editor Rachel Koning-Beals said the next big move for Precious Metals in general will come from the U.S. job market which could hold implications for upcoming interest-rate policy.

Is Texas Running Out of Gasoline?

Many drivers in Texas are seeing signs outside of local gas stations stating that the gas pumps have bled dry, naturally causes even more worry amongst Texans. Of course, much of this comes from the questioning behind whether or not Hurricane Harvey is to blame with the shutdown of nearly a quarter of U.S. refining capacity when the hurricane struck the Gulf coast. However, petroleum analysts say it wasn’t so much Harvey that caused this scarcity in gasoline, but more the panic of residents. CNN Money Jackie Wattles says that according to Patrick DeHaan, an analyst at GasBuddy, “the sudden spike in demand started draining the pumps before they could be replenished.” However, with the help of surrounding states, areas such as Dallas have been able to ‘scrape by.’ DeHaan does predict some quick problems to arise such as skyrocketing gas prices and further shortages. S&P Global Platts said that gas prices "continued to rise Thursday as downed refineries tightened supplies not only in the U.S. Gulf Coast, but on the Atlantic Coast as well." Paxton's office said in a statement that complaints are coming through of gas stations charging around $6-$8 dollars per gallon. But to end on a good note, Rob Smith, a director at IHS Markit, said that although prices are moving higher, “I would probably wait it out rather than wait in line...things are going to return to normal."

At 9:50 a.m. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,323.20 Up $3.50
• Silver, $17.68 Up $0.09
• Platinum, $1,003.50 Up $6.00
• Palladium, $948.50 Up $10.30

APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (ET)! Or call us Fridays until 6 p.m. (ET)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help.