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Gold & Silver Surge - Is This REAL Investment Demand?
CPM and Monex discuss strong investment demand for physical metals like gold and silver and the the bigger storms are yet to come economically and politically.
Investment Demand
Significant real investment demand for precious metals, especially physical metal, in various global markets like India, China, the United States, North America, and Europe. However, as prices reached record levels, physical investors in the U.S. became cautious.
Inflation Analysis
Jeffrey Christian explains that while the overall rate of inflation has decreased due to drops in petroleum product prices, core inflation remains stubborn. He predicts that inflation may not decline as expected, particularly with potential upward pressures from oil prices and service costs.
Record Prices and Investor Behavior
In March and early April, gold prices hit several new intraday record highs. While physical investors showed caution at these levels, there was a noticeable surge in investment through futures, options, and ETFs by short-term momentum investors.
ETF vs. Physical Investing
Over the past three years, while physical demand was strong, ETF investors reduced their holdings. Recently, as physical investors pulled back, ETF investors jumped in to capitalize on rising gold prices.
Outlook
CPM Group anticipates that gold prices might decrease over the next few months before climbing higher in the latter half of the year and into the next.
