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Metal Market Report April 2022 - Week 1 Edition

April 2022 - Week 1 Edition

U.S. Mint Gold Bullion Sales Rose Sharply in March

U.S. Mint gold bullion sales doubled in March 2022 (vs. March 2021) for the American Eagle and American Buffalo series, while American Eagle silver sales were way down in March 2022, due to a shortage of silver blanks and exorbitant premiums for silver bullion coins. Here are the gold totals:

For the full first quarter, the gains aren’t as dramatic, but there are positive gains in both Mint gold series:

As I wrote here last week the new American Eagle silver and gold coins were very popular when first released, but if you want to save on your bullion purchases now, you might want to avoid 2022 issues and buy prior year bullion coins for less than current-year coins cost. The premium for the current American Silver Eagles from the small number of authorized purchasers dealing directly with the U.S. Mint has increased more than 400 percent in the past two years since the Mint has had trouble obtaining the silver and silver blanks it needs for American Silver Eagle production. The premiums alone have risen over $10 per silver ounce, which makes the purchase of current-year bullion coins prohibitively expensive for large purchases.

These are the reasons why American Eagle Silver sales were down about 75% in March 2022 vs. March 2021.

To save money on silver premiums, we assist our clients in purchasing pure silver bullion rounds, 1-ounce legal tender coins minted by foreign mints of prior years or 10 oz. silver bars. Call your account representative today to invest in silver alternatives to the 2022 American Silver Eagles. At the beginning of this year, I predicted silver would reach $27 an ounce, and probably higher, in 2022. That prediction is looking better today.


Gold Up Over 6% in First Quarter 2022

Gold closed Q1 at the end of March at $1,942, up 6.7%, and Silver did even better, up 7.5% for the opening quarter. That beat the Dow Jones Industrial Average (-4.57%), the S&P 400 (-4.95%) and the tech-heavy NASDAQ (-9.1%). Platinum was volatile but ended up gaining +2.3% in the first quarter.  As of Tuesday, April 5, gold and silver are down slightly to $1,922 and $24.32, respectively.


Amazingly, Russia is Establishing a (Limited) Gold Standard

For a decade now, we have noticed and often commented on the fact that Russia and China have been the two centrals banks which have added the most gold to their central coffers. Russia has also unloaded most of its dollars to buy gold. Perhaps this was part of a plan to survive the sanctions that are now attempting to cripple Russia in the wake of its cruel and mostly unexpected invasion of Ukraine on February 24. 

Following the financial crisis of 2008-09, the Russian central bank held under 500 metric tons of gold. As of the latest official count, they held nearly five times as much gold, 2,298.53 metric tons, or about 74 million Troy ounces That gold is worth $143 billion at $1,940 per ounce, making Russia the fifth largest nation by gold holdings (following the U.S., Germany, Italy and France) – and now Russia is putting that gold to work. 

It looks like the cause for the ruble’s rally is that the Russian central bank has established a limited gold standard by setting a fixed price for gold bullion at 5,000 rubles per gram. It is “limited” because it is only available on the domestic (home) market, and it is set below today’s price of gold in grams, which is $62.  (As of Monday, April 4, at the rate of 83.5 ruble per U.S. dollar, 5,000 rubles equals $60 per gold gram.) 

For the time being, this is not a permanent gold standard nor an international exchange rate, since there is no global market for arbitraging the price between gold in Russian rubles vs. gold in U.S. dollars, but it is a start in terms of a major nation creating a limited gold standard in order to support its home currency. If this works to support the ruble, maybe other nations will buy gold in order to support their paper money. 

That would be very good for the price of GOLD! I recommend you buy GOLD, now.


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