For the fourth straight year, gold investment will increase in 2017. Global political and economic factors have driven to increased gold demand despite the fact that the yellow metal has yet to reach once more its highs of fall 2011.
“There has been a return of opportunistic generalist investors who had exited gold in late 2011 and early 2012,” New York-based CPM Group said in its Gold Yearbook 2017.
CPM projects investment in gold bullion to be 17.6 million ounces in 2017. 2016 saw 17.4 million ounces of gold bullion purchased, which was the highest since 2012 – just after the peak – when 29.2 million ounces were purchased.
CPM, which reseraches commodities, conjectured global gold coin demand to be 7.5 million ounces in 2017, an increase over 2016’s 7 million ounces – also, the highest since 2013.
“Most long-term gold investors do not seem to expect the world’s financial and political systems to collapse. Rather, they see them as facing major structural problems that will not be easily resolved or repaired in any short period of time,” CPM said. “In the near- to medium- term as it is becoming clearer to (shorter-term investors) that, while there may not be a collapse in the financial system, clearly the present interest rate environment, global economic growth profile, levels of unemployment and underemployment, and political turmoil globally are all factors that warrant owning at least some gold as a portfolio diversifier.”
CPM, furthermore, cited convoluted policies from Trump’s administration for more sideways precious metals prices in 2017.