The monthly Global Precious Metals MMI® fell to 108 in March, a decline of 4.4 percent from 113 in February, mainly on the back of global silver prices. In fact, most of the price points in the complex tumbled over the last month.
This was the largest fall for the our precious metals index since the October-November decline. However, the index is still holding well above the Jan. 2012 baseline of 100.
MetalMiner’s Stuart Burns recently analyzed the gold market, reporting on the historic rate of recent ETF outflows.
“Since the start of January, gold ETFs have dumped 140 metric tons of gold. February saw the largest monthly outflow of gold from ETFs on record, and Comex has chalked up the highest level of short positions in more than a decade,” he wrote.
According to Stuart’s analysis, the cost of production for gold has skyrocketed over the years, ore grades are declining and new viable mines are few and far between. The main takeaway, however, is to keep an eye on global GDP growth as a key indicator: “If GDP growth does not live up to expectations this year and next, gold at sub-$1,500 per ounce may look like it has some legs after all.”
Meanwhile, ETF Securities weighed in on the PGM market in a report earlier this week: “A seemingly more stable South African supply picture weighed on white metal prices, overshadowing positive auto sector developments,” according to the report. “The stronger USD also helped depress PGM prices.”
Looking forward, however, strengthening automotive markets in the US and worldwide should contribute to solid PGM fundamentals.
Primary Price Drivers of the Precious Metals Index
US silver prices fell 9.4 percent. A 8.1 percent decline hit Japanese silver prices. The price of Indian silver finished the month 7.4 percent lower. After falling 7.1 percent, Chinese silver finished the month down as well.
Following a 6.1 percent decline in price, US platinum bar finished the month down too. US gold bullion prices dropped by 5.1 percent this month. Following a 4.5 percent decline in price, Chinese platinum bar wasn’t spared. A 4.4 percent drop over the past month left Japanese platinum bar lower. After falling 4.3 percent, Japanese gold bullion finished the month lower. Chinese gold bullion was down 4.2 percent for the month. The price of Indian gold bullion fell 1.9 percent. The value of Chinese palladium bar weakened by 1.7 percent this month.
The price of Japanese palladium bar finished the month 5.7 percent higher.
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.