Gold pushes higher on sobering unemployment number, tight physical supplies

Gold pushes higher on sobering unemployment number, tight physical supplies by Michael J Kosares for USA Gold

Gold pushed higher in early New York trading as the government announced weekly unemployment claims rising to 3.28 million – a sobering number that directly reflects the cumulative effect of the coronavirus on the real economy. It is up $20 at $1632 and up $159 (+11%) on the week. Silver is up 10¢ at $14.52 and up $2.10 (+20%) on the week. In stark contrast to today’s numbers, 281,000 new claimants filed for unemployment last week.

The big story in the gold market itself continues to be the shortage of physical metal caused by the virus, its impact on pricing in the futures market, and, in turn, the knock-on impact in pricing gold coins and bullion at the retail investor level. “[T]he larger spot market in London,” explains Bloomberg in a report this morning, “is dominated by 400-ounce bars of gold, but only 100-ounce and kilobars are deliverable on the Comex contract. Late on Tuesday, after New York futures shot to the highest premium to the spot price in four decades, CME Group said it would launch a new futures contract under which 400-ounce bars would also be deliverable, helping ease tightness.”

Important client note:  Due to our long-standing relationships with key market-makers and our own inventory planning, we are still working from a strong inventory position and are able to deliver most of the standard gold and silver bullion items – American Eagles, Canadian Maple Leafs and Krugerrands.  Even our sources though are strained under the circumstances and our inventory, of course, is finite. We do not know, as a result, how long the supply will hold up.  All deliveries are running on schedule with occasional minor delays due to the order and shipping volume, and we think you will find our pricing as advantageous when compared to most sources.  The one thing we have no control over is rising premiums which, unfortunately, we have no choice but to pass along.  Please contact us to discuss prices and availability. 1-800-869-5115 x 100

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