Physical gold buying rockets

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An honorable member of the Coffee Shop Has Just Posted the Following:

Physical gold buying has taken off in Europe during recent weeks as the Greek crisis reaches its climax though central bank intervention in the Comex paper market for the metal has so far managed to keep a lid on prices and actually push them down.

Demand from Greek customers for Sovereign gold coins was double the five-month average in June, said the Royal Mint. CoinInvest.com, an online retailer, said sales last Saturday and Sunday were the highest since Cyprus limited cash withdrawals in 2013, driven by a jump in German, French and Greek buyers.

Capital controls

Investors are searching for a safe haven after Greece imposed capital controls, closed banks and stopped selling gold coins to the public. The referendum this weekend may or may not result in a quick resolution of this crisis.

GoldCore, which buys and sells bullion, reported coin and bar demand rose ’significantly’ on Monday with sales about three times the average for the past three Mondays. The US Mint sold 61,500 ounces of American Eagle gold coins last month, the most since January.

BullionVault, which says it operates the largest online physical gold trading platform, reported a jump in sales during the first half of this year, a sign of a broader increase.

What happens next in the Greek crisis is clearly going to be critical for gold. If the country votes to leave the euro then chaos will breakout in global financial markets this Monday and the central banks will likely lose control of the gold price along with a lot of other things.

If Greece comes back to the table with its tail between its legs then markets will likely give a muted response and carry on with business as normal. That said the Chinese equity bubble’s bust last week is another factor that will likely move the gold price going forward.

One factor depressing the gold price recently has been the flow of money into equities in China, reversing the rush to buy gold. With gold one of the few alternatives to cash in China for investors this safe haven should now move back into favor.

Buy gold now

Of course if both worried European and Chinese investors now decide to buy precious metals then this asset class is due for a really serious re-rating.

What the physical market is telling you is that the tipping point for gold prices is very close and the bears are barking up the wrong tree. Equities are topping and gold has been bottoming.

Where do markets usually move from that position?

http://www.arabianmoney.net/gold-sil...pulated-lower/


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