This Week:
- Why Buy Gold?
- Why Buy Silver?
- And Choosing Between the Two Precious Metals
- Why it Might be Premature to Celebrate the NZ GDP Numbers
- Why Trump Could Be Good for Gold
Prices and Charts
Silver Outperforming Gold This Week For a Change
Gold in NZ dollars was down 0.63% this past week. Dropping quite sharply before bouncing back above $1800. So keeping above the horizontal support line at $1775.
For a change silver outperformed gold this week. In NZ dollar terms silver was up 1.35% after bouncing off the rising uptrend line. Perhaps NZD silver has made a bottom at last?
The New Zealand dollar jumped sharply on better than expected GDP numbers (more on that soon). Getting briefly above the 50 day moving average. But it didn’t manage to stay there and has fallen away the last few days. So far the Kiwi has made yet another lower high. So while the plunge may have abated or slowed up, it’s much too early to say the trend down is over.
Need Help Understanding the Charts?
Check out this post if any of the terms we use when discussing the gold, silver and NZ Dollar charts are unknown to you:
Continues below
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Why it Might Be Premature to Celebrate the NZ GDP Numbers
As noted already the higher than expected Gross Domestic Product (GDP) numbers caused a sharp jump in the NZ dollar this week.
GDP for the June quarter was up 1% compared to the Reserve Bank expectation of 0.5%.
However it may be premature to celebrate yet given these numbers are only up to the end of June and we are nearly at the end of the next quarter now.
These numbers will also not yet show the full impact of rising petrol prices, which will still have to filter through to higher prices for many other goods and services.
Which in turn should dampen spending on non necessities.
As an insightful commenter on interest.co.nz pointed out:
“The 6-7% NZD fall we had during the June quarter gave a boost to exporter (farming) incomes. But the hangover is coming… Inflation lags currency moves by about 2-3months so september quarter inflation will be sharply up and GDP result will be hammered by that high inflation. As a nation that imports far more than we export, and with little ability to increase agricultural capacity, we will be hurt more than we benefit by the currency falling.”
Of course GDP is a pretty pointless measure anyway. As GDP measures all spending including government spending. Even spending after say a natural disaster will show an increase in GDP. So an increase in GDP doesn’t necessarily mean an increase in wealth for the residents of a country.
Even the bank economists don’t expect the GDP numbers to have a major impact on tomorrow’s Official Cash Rate (OCR) announcement by the RBNZ. With the central bank likely to maintain its position that the next move for interest rates could be up or down.
Why Buy Gold and/or Silver?
With prices of gold and silver overall pretty stagnant this year we thought it a good time to review the reasons to buy precious metals.
First up here’s 15 reasons to buy gold. The first 9 are reasons to buy gold right. The remaining 6 are timeless reasons to buy.
Next we have 21 reasons to buy silver.
11 of these are similar to the reasons to buy gold. The remainder are quite specific to silver itself.
Your Questions Wanted
Remember, if you’ve got a specific question, be sure to send it in to be in the running for a 1oz silver coin.
Should You Buy Gold or Silver? 7 Factors to Consider in Gold vs Silver
The previous 2 articles look at why you should buy gold and silver in isolation.
However we know for most people buying, the most difficult choice can be whether to go with gold or silver.
Which metal is a better choice for you? In this article you’ll learn about some significant differences between gold and silver. We’ll outline 7 factors to take into consideration in making your decision and highlight whether gold or silver is the winner in each case.
Why Trump Could Be Good for Gold
Greg Canavan this week pointed out how Trumps trade war moves could be good for gold. As they will cause some pain for US multinationals. And that means pain for the stock market due to uncertainty. And gold likes uncertainty.
But there is also a much unreported move that Trump is attempting to make that could be even more positive for gold:
“Last Monday, the White House released a statement explaining that Trump has ordered the declassification and release of a bunch of material relating to the Russian collusion investigation. You can read the statement here.
If you’ve been following events, you’ll also know why the MSM aren’t covering the story, despite it being a huge one. Or if they are covering it, they’re running with the line that declassification will put people at risk, and therefore it shouldn’t occur.
Yet it’s widely alleged that various US government agencies, along with the MSM, tried to frame Trump. Releasing all material related to the investigation could reveal this to be true, which is perhaps why those implicated are now resisting.
As this story grows (and it will), it risks spilling over into markets in the form of a weaker US dollar and a higher gold price. My view is that if corruption at the highest levels of US government agencies is exposed, it will create nervousness and uncertainty about investing in the US. There will likely be a shift from ‘risk off’ to ‘risk on’ in US equity markets.”
Source.
If Trumps moves could be the bump for gold, be sure to be on board beforehand.
Check out the deals going currently.
- Email: orders@goldsurvivalguide.co.nz
- Phone: 0800 888 GOLD ( 0800 888 465 ) (or +64 9 2813898)
- or Shop Online with indicative pricing
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