Gold Digger: Has the gold price hit rock bottom? Almost, experts say
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The gold price, pressured by the rising US dollar and attractive bond yields, neared nine-month lows this week.
Like the wider markets, gold is reacting badly to rising bond yields, Brien Lundin, editor of Gold Newsletter, told MarketWatch.
A rising dollar and strength in bond yields can make gold less attractive to buyers seeking safe-haven investments.
“What we’re seeing right now is the pre-fight face-off between the Fed [US Federal Reserve] and financial markets,” said Lundin.
“What’s coming is a battle royale wherein the markets are demanding that the Fed to do something to halt the rise in rates.”
The end game will mean either Fed action or a loss of credibility in the dollar — and under either scenario gold benefits, he says.
“Gold is suffering through this transition phase right now, but it will benefit greatly from the policies that will result.”
Here’s how ASX-listed gold & silver stocks are performing:
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AMANI GOLD (ASX:ANL) +50%
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Late last month, Amani Gold’s storied exec chairman Klaus Eckoff took on the additional role of managing director.
The minnow recently raised $3m to fund drilling, resource estimates and feasibility studies at the mammoth 4.4Moz Giro gold project in the Democratic Republic of the Congo.
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The advanced gold explorer is busy growing resources at the flagship Marymia project in WA so it can “rapidly transition to completion of feasibility studies and the potential development”.
Marymia has an existing resource of 1 million ounces at 3 g/t gold, underpinned by the high grade 410,000oz at 8g/t ‘Trident’ deposit.
Drilling of open pit targets is planned for this coming field season to help with mining studies, the company says.
Punters responded positively to the miner’s presentation at the Global BMO Global Metals and Mining Conference this week.
Ramelius increased production by 57 per cent in the December half, which led to profit surging 297 per cent to $81 million compared to the December half in 2019.
Full year production guidance is 260,000 to 280,000oz at an all in sustaining cost (AISC) of between $1,230 – $1,330/oz.