GoldCore Precious Metals Update – Threat to Petrodollar Sees Gold Surge to Near Record Highs

Gold
The dollar came under sustained pressure as the Independent of London’s Robert Fisk broke a story stating that a group of Arab countries, Russia, France, Japan and China and others were in secret discussions to use a basket of currencies and gold to replace the dollar in order to trade oil.

Although some officials have denied this report, the fact that it is mentioned at all raises the question as to how much longer the dollar will remain the global reserve currency. According to Chinese banking sources, the transitional currency in the move away from dollars, may well be gold. Gold surged to $1,021/oz on the news of this increasing threat to the petrodollar.

The unexpected move by the Australian central bank to increase interest rates may have also pressurised the dollar. At some stage central banks will have to start withdrawing the unprecedented monetary stimulus of recent months and years. A rising interest rate environment from the unprecedented historic low rates we have now is bullish for gold as it was in the rising interest rate environment of the 1970s. Gold has risen through resistance at $1,020/oz in recent minutes to as high as $1,025/oz and looks set to challenge the record (nominal) high of $1,033/oz. A close above the record high should set us up for the anticipated rally to $1,200/oz.

Silver
Silver also moved upwards on the above news and is currently at $16.91/oz.

Platinum Group Metals
Platinum, palladium and rhodium are all up in morning trading at $1,300/oz, $302/oz and $1,575/$1,675/oz respectively.
 

Stephen Flood

Stephen Flood is the CEO of GoldCore. He is a former Wall Street equity trader and FinTech expert. He has been involved in the precious metals markets since 2004 and has appeared as an expert contributor on CNBC, CNN, BBC, RTE & Bloomberg TV and has had articles published in the Irish Times, Irish Independent and The Sunday Business Post.

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