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Gold Sales Pop at Perth Mint as Investors Take Advantage of Low Prices

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Gold sales at Australia’s Perth Mint rose to their highest level in nearly a year in August as investors took advantage of gold on sale.

According to the mint, sales of gold coins and minted bars surged 30% to 38,904 ounces last month. It was the strongest month of gold sales since November 2017. Sales were nearly doubled from a year ago, according to the mint.

“Lower bullion prices continued to support interest in our minted products among investors,” a company spokesman said.

Silver sales were also strong at the Perth Mint, rising nearly 7% from July to 520,245 ounces. From a year earlier, sales advanced about 33%.

The Perth Mint refines more than 90% of Australia’s gold mine output. The country ranks as the world’s second-largest gold producer after China.

Silver prices fell more than 6% in August as the price of gold declined about 2%. As we have been saying, this represents silver and gold on sale. Savvy investors are taking advantage of the low prices and shopping the sales.

But gold sales have not been as hot in the US. According to the US Mint, the sale of American Gold Eagles dropped off in August after a strong July. The mint sold a total of 21,500 ounces of gold in various denominations in August, a decline of 38% from the previous month. July was the strongest month of gold sales at the US Mint since the start of the year.

Meanwhile, demand for American Silver Eagles came in at the highest level since the start of the year last month. The US mint sold 1.53 million one-ounce American Eagle Silver coins in August, an increase of 72% from July.

Even though gold sales were tepid at the US Mint in August, overall, sales have picked up compared to this time last year.  August sales were up 126% from the lackluster demand reported a year ago.

In a recent report, the World Gold Council offered three reasons it thinks gold will rebound in the latter half of 2018. One of the primary reasons is increased physical demand.

Gold’s recent price pullback will likely support consumer demand as, historically, lower prices have increased jewelry buying. For investors, gold’s current price range may offer an attractive entry level.”

We’ve already seen signs of this. The Chinese are buying gold.

The rise in investment demand in Q2 has been linked in part to the depreciation of the yuan, as gold is often used as a currency hedge. This trend has continued into Q3 with increasing volumes in Shanghai and robust inflows in Chinese-listed ETFs over recent weeks.”

We’ve also seen a “tilt toward buying” in India. Demand for the yellow metal surged in July, and analysts expect a good growing season to boost Indian demand further in the second half of this year.

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