Gold’s recent rally isn’t just paying off for investors, it’s also creating a tailwind for gold buyers, as trading and sales of old jewelry has picked up as a result of the commodity’s price increase, according to Bloomberg.
Empire Gold Buyers saw business activity climb to its highest since 2011 and House of Kahn Estate Jewelers saw trading of old jewelry up by almost half since last week after the Fed mentioned that it may be open to cutting interest rates last week. This caused gold bullion prices to rise.
About $4.9 billion was added to gold-related exchange traded funds this month, including a record daily inflow into GLD. Meanwhile, gold refiners and recyclers are benefiting from the rally after years of little to no interest in the precious metal.
Empire Gold Buyers CEO Gene Furman said:
“People are coming out of the trenches. Cartier, Rolexes, Tiffanys, Van Cleefs: we see an uptick in the luxury market because people need to raise money.”
Gold now looks as though it has permanently settled over a key resistance price point at $1400 per ounce. The continued speculation that the Fed may cut rates has helped gold sustain its recent rally to six-year highs.
In addition, the metal has drawn the interest of speculators. Open interest in outstanding gold futures is up 26% this month, the most in almost 2 years. ETF holders added nearly 86 metric tons to their assets this year.
And Goldman Sachs analysts believe that the metal could rally above $1600 an ounce with ETF holdings climbing by 800 tons through September.
Tobina Kahn of House of Kahn Estate Jewelers said: “The tides are turning big time. As a gemologist, I’m a buyer, if I can see that gold is continuing to go up, I’m more confident about paying more for it than having it go down.”
via ZeroHedge News https://ift.tt/2XipWh2 Tyler Durden