Gold and Silver Trade Sideways

Gold and Silver Market Insights

We start the week seeing the price of Gold and Silver trading sideways, as we view a weaker dollar and stronger treasury yields.

CME Silver Warehouse stocks continue to increase as refiners are still having a tough time finding a home for their 1000 ounce Silver bars. CME Silver stocks now stand at almost 269 million ounces. There is currently more 1000 bars being produced than the market can absorb.

A Look At Our Platinum Past

You might be asking yourself? What happened to the price of Platinum?

Many of us remember what the price of Platinum exceeded the price of gold. At one time the price of Platinum was 2.3 times the price of Gold.

Platinum prices have now traded below the price of Gold for more than 3 years now. The decline in Platinum started a few years ago with the negative news over toxic emissions from diesel engines – the metal’s single heaviest source of demand.

Platinum is primarily used in in catalytic converters for diesel powered vehicles, however, the lack of demand for diesel powered cars in Europe and China has put continued pressure on the price.

As platinum lost its luster, her sister Palladium was getting all the attention.

Palladium is used in gas powered engines and with the increase of car sales here in the U.S. after the numerous hurricanes we experienced and the shortness of supply across the globe, the price of Palladium blew right past the price of Platinum.

So you must be asking yourself, can Platinum close the gap between the price of Gold and the price of Palladium?

Many analysts expect the price of Platinum to rise in the second half of this year. Some are calling for an average in the fourth quarter to reach $1,060. Limited supply and increased investment demand is expected as low prices have reduced mine production and eventually should support higher prices.

The World Platinum Investment Council in December was calling for a shortage of 275,000 ounces in 2018.

Let us not forget that there are many uses of Platinum. Platinum is used in autocatalysis, jewelry, industrial applications and medical devices.

In automobiles, platinum is used in catalytic converters where the metal reduces the percent of hydrocarbons and carbon monoxide from the exhaust.

In jewelry, platinum is the second largest source for jewelry production as the metal is strong, resists tarnishing and can be heated and cooled without hardening or oxidizing.

Industrial applications include fertilizer, silicones, hard disks, electronics, dental applications, glass manufacturing equipment and sensors in home safety devices.

And in medical devises Platinum is ideal for catheters, stents, and neuromodulation devices.

So now that you have read all the numerous practical applications for Platinum, shouldn’t you consider physical Platinum as part of a balanced portfolio?

Here are ways to invest:

Platinum bars are a good way to start and offer an investment in many sizes. Coins are another common type of bullion, and a government mints such as the United States Mint and the Royal Canadian Mint produces attractive products.

Some examples of Sovereign Mint Platinum products include coins like the Platinum American Eagle series,
Platinum Canadian Maple Leafs, Australian Koala Coins and – new for 2018 – the Platinum Britannia.

It is our hope that dealers will choose Dillon Gage as your supplier for these fine Platinum products.

Have a wonderful Monday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals for information and thought-provoking purposes only and does not purport to predict or forecast actual results. This editorial opinion is not to be construed as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein cannot be attributable to Dillon Gage. Reasonable people may disagree about the events discussed or opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. It is not a solicitation or advice to make any exchange in commodities, securities or other financial instruments. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisers with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.