Gold and silver have been getting slammed for weeks but Jeff Christian, one of the world’s leading precious metals analysts, thinks this is more of a short-term reaction to subsiding geopolitical fears and reiterates his long-term bullish outlook based on a number of fundamental drivers.
Recent Weakness Is Short-term
In early April, the price of gold was roughly $1,250 an ounce, he noted, as the US bombed a Syrian airbase and the Trump administration made a statement about sending an aircraft carrier group off of the Korean peninsula.
This saber rattling dovetailed with concerns about populist French presidential candidate Marine Le Pen possibly taking the lead in the French elections. Now, with Emmanuel Macron’s defeat of Le Pen, fears over a further break-up of the European Union have subsided and the demand for gold has weakened.
‘There was a tremendous amount of political uncertainty and risk,’ Christian noted. ‘In that environment, the price of gold went from $1,250 to $1,297 over about a two-week period. Then it came back off. … I think what we’re seeing is not a massive move away from gold but a very short-term (reaction).’
This post was published at FinancialSense on 05/09/2017.