Gold price teeters and totters ahead of US presidential election
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The price of gold was hovering around $US1,900 per ounce ($2,665/oz) Tuesday as investor nervousness around the outcome of the November 3 US presidential election took some momentum out of the market.
“Even though polls continue to indicate a Biden victory and a Democratic Senate, gold price action has stalled, despite this election scenario posing the greatest upside risk for the metal,” Standard Chartered precious metals analyst Suki Cooper told Kitco news.
Several drivers of recent record gold prices – negative real interest rates, expectations of a weaker US dollar and governmental economic stimulus spending – continue to support higher gold prices, Cooper added.
Physical gold purchases for the September quarter at 562 tonnes are 30 per cent down on last year, as consumer demand has been sapped by the COVID-19 pandemic, according to reports.
Central banks were net sellers of gold in the September quarter for the first time since 2010, according to Refinitiv.
An absence of buying by China and Russia and higher gold prices resulted in central banks off-loading a net 18.8 tonnes of gold in Q3, said the reports.
US investment bank JP Morgan said in a note that cryptocurrencies are competing more intensely with gold for investor attention, particularly among younger age groups.
“Cryptocurrencies derive value not only because they serve as stores of wealth, but also due to their utility as a means of payment,” said JP Morgan in a research note.
“The more economic agents accept crytocurrencies as a means of payment in future, the higher their utility and value,” added the bank.
Silver was trading steady at $US24.30 per ounce ($34.10/oz), and off its August high of $US28.30/oz, according to Bullion Vault’s website.
Renascor Resources’ (ASX:RNU) shares took off in Tuesday trade as the company announced Rio Tinto (ASX:RIO) as a joint venture partner for its Marree project in South Australia.
Rio Tinto Exploration can earn an interest of up to 80 per cent in an exploration licence for the Marree project in the Adelaide Fold Belt by funding $3m of exploration spending.
“This agreement is consistent with Renascor’s strategy of maximising the value of our significant pipeline of exploration projects in South Australia, while dedicating our resources towards advancing core projects with near-term potential to offer significant value uplift,” managing director, David Christensen, said.
Marree is prospective for copper and some anomalous gold to a maximum of 2.6 grams per tonne has been associated with the mineralisation at its Callanna prospect.
After its capital raising in September, Renascor has a healthy cash balance of $5.2m.
Stavely Minerals (ASX:SVY) was another good share performer as it revealed spectacular shallow intercepts for copper and gold along strike at its Cayley Lode in Victoria that was only discovered last year.
The intercept includes a high-grade zone of 28m at 3.3 per cent copper, 0.49 g/t gold and 7.1 g/t silver from 151m and is 275m from its Thursday’s Gossan prospect within its Stavely copper-gold project.
“The Cayley Lode continues to deliver some quite exceptional shallow drill intercepts of high-grade copper, gold and silver mineralisation,” executive chairman, Chris Cairns, said.
Helix Resources (ASX:HLX) has restarted drilling at its Cobar gold project in NSW in a program for 29 holes and 3,400m expected to be completed in November.
“In this second phase of the program, drilling will be focused on previously untested areas identified as a high priority for drilling in the broader gold camp,” executive chairman, Peter Lester, said.
Cobar is near Manuka Resources’ (ASX:MKR) Mt Boppy gold mine in western NSW.