The Asia Miner

JUL-SEP 2019

The ASIA Miner - Reporting Important Issues to Mining Companies in the Asia Pacific Region

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the asia miner • volume 16 • issue 3 27 FEATURE: Gold Historically, gold prices tend to spike largely as a response to geopoliঞcal tensions and uncertainty, being perceived as a safe haven to ease the effects of global turmoil. The situaঞon between the US and China took a turn for the worse when the two power countries clashed in May 2019 at the Shangri-La Dialogue in Singapore over security disputes surrounding Taiwan and the South China Sea. "Gold finally behaved like a safe haven, breaking out higher a[er the trade war escalaঞon led to a code red for global growth," stated Edward Moya, senior market analyst at OANDA. Industry experts have also noted that gold stepped back into the spotlight at the start of June 2019, when US President Donald Trump first revealed his plans for tariffs on Mexico. In fact, 31 May 2019 was the first ঞme the yellow metal surpassed the psychological US$1,300 level since April, staying roughly US$20 behind it during that ঞme. The World Gold Council has revealed in its Gold Demand Trends Q1 2019 report that global gold demand grew to 1,053.3 tonnes (t) in Q1, up 7 per cent year on year (y-o-y). This compares with a relaঞvely weak Q1 2018, when demand sank to a three-year low of just 984.2t. Much of this growth came from India, where wedding- related demand was boosted by a ঞmely correcঞon in the local gold price Demand in the US increased for the ninth consecuঞve quarter, gaining 1 per cent to 24t – the highest Q1 total since 2009. As investors grow increasingly concerned that the ongoing US- China slinging match over trade tensions, as well as Washington's threat of tariffs on Mexico could negatively affect the global economy, gold prices hit an all-time high in Australia in June, breaking the AU$1,900 per ounce mark in the Australian currency for the first time ever. IN GOLD WE TRUST: THE SAFE HAVEN COMMODITY RETURNS

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