Monthly Precious Metals Index Jumps on China, Europe Economic Worries

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MetalMiner’s precious metals index reading skyrocketed this month due to a number of factors – from the announcement of QE3 to concerns about the economic performance of China and Europe.

The monthly Global Precious Metals MMI® registered a value of 115 in October, an increase of 8.5 percent from 106 in September.

Despite the headline increase, the precious metals index came in second amongst all of the index readings (behind the stainless steel index). For the year, the Global Precious Metals MMI® marked its second-highest bounce (it increased by twelve points back in January).

Precious Metal Price Trends - January to October 2012

Source: MetalMiner IndX℠

“Gold hit an 11-month high on Friday in its fifth day of gains as stimulus measures from major central banks continued to increase its appeal as an inflation hedge, while investors awaited more trading direction from key U.S. jobs data due later in the day,” a Reuters report stated.

“Gold [prices are] likely to gain further as other central banks, including that of China, are expected to ease policy following similar moves by the ECB, Federal Reserve and Bank of Japan to help stalled growth, analysts and traders said,” the report continued.

Platinum and palladium prices on MetalMiner’s precious metals index also pushed higher this month, stimulated by increased automotive demand this quarter, as both PGMs are used in cars’ catalytic converters, as well as worries over mine strikes.

Price Drivers of Precious Metals Index

For the second month in a row, the price of US silver increased sharply – following gold – rising 17.2 percent over the past month.

The price of US platinum bar rose 11.4 percent over the past month. The price of Chinese platinum bar increased 10.1 percent. the price of Japanese platinum bar finished the month 9.7 percent higher.

The price of Chinese palladium bar rose 9.1 percent over the past month, the second straight month of gains. US palladium prices increased 4.4 percent.

The price of US gold bullion rose 7.3 percent over the past month, the fourth straight month of gains. The price of Chinese gold bullion closed the month up 6.3 percent.

Precious Metals Price Forecast?

We won’t begin to speculate on the precious metals complex moving forward, but don’t believe this latest scientific advancement will have much of an impact on gold prices.

The Global Precious Metals MMI® collects and weights 14 global precious metal price points to provide a unique view into precious metal price trends over a 30-day period. For more information on the Global Precious Metals MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.

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