opinion

Why gold and silver prices are falling despite Iran conflict escalating

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By CPM Group
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Why gold and silver prices are falling despite Iran conflict escalating teaser image

In this presentation, Jeffrey Christian of CPM Group looks at recent movements in gold, silver, platinum, and palladium markets. Gold prices have been consolidating near the $5,000 after reaching record highs earlier in the year. Many market participants question why prices have not risen even more sharply as tensions in the Middle East escalate and oil prices rise.

Jeff explains why gold does not necessarily move tick-for-tick with oil prices, even during periods of conflict in the Middle East. While higher oil prices can support gold, the historical relationship between the two markets is far weaker than many investors assume.

The presentation then moves to the relationship between gold and interest rates.

Jeff also discusses  the current consolidation in gold and silver prices, noting that some investors have stepped back after strong gains earlier in the year and that seasonal patterns and weaker fabrication demand are affecting the market. While short-term price volatility, including potential pullbacks, remains possible, CPM Group continues to see economic and political conditions that support higher precious metals prices over the longer term.

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CPM Group

CPM Group is a commodities research, consulting, financialadvisory and commodities management firm providing independent research,analysis and advisory services related to commodities markets, corporate andproject finance, and the financial management of exposure to commodity orientedinvestments.

We started our business in 1986 predicated on the idea that commoditiesresearch and advice is best delivered by independent experts who do not work forbanks, brokers, mining companies, or any other entity that has interests thatcould conflict with the best interests of the clients receiving the research,analysis, and advice.

All of our work is driven by fundamental commodities research and economicanalysis. As we undertake our research into individual commodities markets wegather a tremendous amount of information and develop an enormous body ofextremely high quality, unbiased analysis of the markets and the companies thatare involved with individual commodities. The outputs of our research andanalysis take the form of research reports, specialized and targeted consultingrelated to these markets, financial advisory services ranging from corporate andproject finance structuring to equity introductions, and managing specificcommodities and investment positions for clients.

CPM Group continues to demonstrate the economic value and financial worth ofsuperior research, information, and analysis. Our research is based onmicro-economic analysis of the individual components of each commodity market,wedded with a top-down macro-economic analysis of the global trends affectingthese markets. We apply the results of that analysis to our research,consulting, and advisory services.

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Jeffrey ChristiangoldsilverplatinumpalladiumMiddle Eastoil
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.