Reserve Bank Of India Buys More Gold In Q1 Than All Of 2023 | Arcadia Economics

According to the World Gold Council, RBI gold purchases in the first quarter of 2024, 19 tons, surpassed the full year of 2023’s total of 16 tons. It added another five tons in April. Welcome to the Morning Markets and Metals with Vince Lancey, where each day he brings you the precious metals and financial news to get you ready for your day. And now, here’s Vince. Good morning everyone. I hope everyone had a good weekend. I’m Vince Lancey and in today’s market rundown, we’re going to talk about Indian gold demand and last week’s Metals Mining and Steel Conference hosted by Bank of America.

Some highlights on that. We have some very good slides, very highlights of presentations by various mining companies, as well as some insights that you may not have heard before. Okay, and then we’ll look at some market driving news. But first, let’s look at the markets. The dollar is unchanged at $104.62. Ten-year yields are $446 down three, almost four basis points. The S&P 500 is $52.90, up five and a half handles. The VIX is $13.15. Gold is $23.29, up $3, at the high end of its range, very lackluster moves last night. Silver, $30.34, near the low end of its high range, down three cents.

Copper is $4.60, up about a penny. WTI is $77.38 down 11 cents. Natural gas is $2.49, up 12 cents. That’s a big move and it’s above $2. It’s only up 5%, but it’s a big enough move to pay attention. Dips are being bought. Crypto, $69,000 for Bitcoin, up 1351. Ethereum, $3,800, trading up 28 points on the day. Interesting. Platinum, Palladium, both down. Platinum down more than Palladium today. Palladium is $9.10, down $4 and change. Platinum is $10.27, down $8 and change. Last night, it wasn’t like that, so this is a bit of a reversal for Platinum today, so keep that in mind.

Grains are mixed with wheat higher by one and a quarter percent at $6.95 and soybeans lower by $0.09 and $11.87 with corn essentially unchanged. Okay, there’s the working title, Bank of America’s Takeaway from the MM&S Conference. The thing that attracted me to the report was their comment about India and that as I drilled into it, there was a lot more to share and so let’s do that. First, here’s the home page. Someone made a nice comment or compliment this weekend. I’m going to share with you and I appreciate it. They were looking at our home page and they said, I get more in one day from your site than I do in a year on mainstream media.

So, that’s a really nice compliment. We appreciate that. On that note, an economics piece, Goldman on the coming financial repression, how that works. An options masterclass, this is a university style lecture on how to understand and get more out of the zero hedge posts that talk about gamma clenching and unclenching. It’s an options class. And over the weekend, we also put up a CFTC note on what we thought our impression of the commitment of a trader’s report. And just to give you the short version, business as usual, funds are liquidating, banks are covering shorts, big, but not abnormal.

All right. The main events, Bank of America’s update from the MM&S conference report. All right. So, here’s a little paragraph that I wrote. The 41st annual Global Metals Mining and Steel Conference highlighted key trends in the precious metals sector. Notably, but not alone, there’s a lot of companies in here, a lot. Wheat and precious metals expressed a bullish stance on gold due to its sustainable value and portfolio diversification capabilities. In contrast, which we think is more interesting, frankly, companies like Barrick Gold and Pan American Silver showed mixed attitudes towards copper with Barrick planning to double its copper production by 2029, while Pan American Silver sold its stakes in copper assets to focus on precious metals.

Now, there’s a lot we can say about everything here. We want to get to it. I just want to put in why I put that in there. It seems like that’s good for both companies. If you’re a gold mining company, you better start mining more copper. And we’ve gone through that before. And if you’re a silver company and you’re able to focus on silver as opposed to copper, well, at first you’d say, okay, that’s crazy. A lot of good companies out there have to mine gold because it’s hard to make a living mining silver, at least has been, hopefully not recently.

But if you drill down on the financials on Pan American, you could see how it makes sense. They’re taking steps to make that a good decision. Okay, there’s a lot in here and I’m going to go through it quickly. They had a spotlight on Indian gold demand, minor rating changes, a slew of intriguing slides for key themes, analyst ratings and comments, and 29 slides in all from key companies and much more. So there’s the front page. We’re going to read some of this for you, so don’t focus your eyes on that too much.

The Bank of America precious metals report summary, my words, bullish gold outlook, wheat and precious metals and other firms maintain a positive outlook on gold due to its value retention and diversification benefits. Copper prospects, we just went through that. Indian gold demand, this is what got me interested. Strong central bank and consumer demand in India with a temporary expected slowdown. Everyone’s always expecting a temporary slowdown in India, and it just never comes. But here’s the line that made me pay attention. According to the World Gold Council, RBI gold purchases in the first 14 tons surpassed the full year of 2023’s total of 16 tons.

It added another five tons in April. This is no aberration. They just repatriated a chunk of their gold from England. They’re going to repatriate more of that, and now they’re buying gold. So put your little tin forehead on. When China slows down in gold purchases, India picks up. They’re cooperating. It’s very significant. When you look at it from the BRICS deadline point of view, as we’ve mentioned several times, and we’ll just reiterate it here, there’s a deadline. All of the BRICS have mandates to get their houses in order by the time the October summit happens.

One of those mandates is to get as much collateral as you humanly can under your roof for dissemination in whatever comes out of the BRICS conference, whether it be a BRICS coin or the M-Trade platform. But this is what’s going on now. They want their collateral. They want the gold. And we all know India wants the silver too. And I think, and I mentioned this yesterday, and I’m going to write up more on it. Silver’s going to be part of the BRICS coin process, I believe, and I’m predicting, but no details yet.

And I’ve gone through the reasons for that one other time. All right, moving on. Economic data impact. Strong US economic indicators and FOMC stance on interest rates contributed to recent gold price declines, right? Nothing new there. That’s part of the report. Capital returns. Emphasis on financial discipline and notable M&A activity. I think that sounds kind of platitude-ish, but it’s true. Their financial discipline that they learned from decades of undisciplined is serving them well in a high interest rate environment. And I think people are not buying them because, not by miners, because of previous undisciplined errors.

But this is a disciplined error. Valuation metrics. Precious metal stocks are trading at favorable valuations. Yada, yada, yada. Okay. There are a ton of good slides in here. I’m going to show you five or six of them. Okay. All right. So Pan American Silver, there’s a nice slide there. You know, it talks about their portfolio optimization, meaning out of copper into silver. Okay. Well, you can, you can see that there. I would say the theme for Pan American is focus on your core competency, right? They’re divesting of things that aren’t their focus. It sounds like they’re getting ready for a big bet on silver, to be honest with you.

Next, price to net asset value for North American gold and precious metals, producers, and royalty companies. There are several slides like this. This is one of them for relative value. Those are all the minds. Those are some of the minds they cover. North American gold producer and royalty and streamer, price to net asset value. The star is where we are right now. Year to date returns for the gold sector. They have week to date and they have a month to date as well. And these are the, these are the stocks they cover.

There’s several, there’s several good slides in there. And obviously, Wheaton is a featured minor for Bank of America’s show, trade show, we’ll call it, right? But, you know, every good mind has something, something, all the best presentations are highlighted in here. Okay. So Wheaton’s bullish goal because of sustainable value diversification abilities. All right. I think this is interesting. And I think it’s part of the focus of the report, but the other stuff I think is just outstanding. So here’s an example, a sample of some of the minds that they’re covering. And there’s a lot more.

I can’t show too much right now. But anyway, there’s much more at the bottom on this. We have the full report for you. And I think you’ll enjoy it very much if you’re a mining person. All right. We’re going to skip market news. There is market news out there, but nothing compelling. I think the more important thing to focus on, especially from a precious metals perspective is the geo politics. I’m going to read these. They’re closer to a deal, but there is less wiggle room now and legal parsing enters the chat. Okay.

Israel PMA confirmed on Sunday that Israel had accepted a framework deal for winding down the Gaza war, Gaza war. Okay. So we’re moving towards peace. Then Yahoo says that contrary to President Biden’s words, there is no clause in the draft agreement that includes stopping the war. Right. Lawyers enter the chat. Hamas Hamas, listen to me, said they view US President Biden’s latest proposal for a cease fire as positive and affirmed its readiness to deal positively. That says to me, Israel has no more wiggle room. They’re not going to bend anymore. And Hamas is sensing that in next paragraph.

Axios is a ravine poses. Israeli officials told me the Israeli hostage your proposal buying presented in his speech exhausted Israel’s maneuvering space. There will not be a better one. If Hamas, Hamas rejects it, the conflict will likely ex escalate. As I said, a copper factory in Aleppo and other geopolitical news. And there’s, there’s more, but that’s what we’re going to talk about now. So data on deck this week, moving to data, moderate to heavy week with the unemployment report coming out on Friday. Today you have S&P flash, US manufacturing PMI and other indicators of other more current indicators of how the economy is doing.

Okay. So there it is in premium. The global MMS conference, intriguing precious metal slides spotlight spotlight on India events. Have a great day. And to get a full price list or place an order for silver cougarands at $3 and 10 cents over spot, just email us at Arcadia at miles Franklin, and we’ll be happy to get you set up with anything you need. And as always, thanks for watching. Hope you’re having a great day out there. Please note that this video is not intended as legal licensed financial trading advice and is to be used for informational purposes only.

Please contact your financial advisor before making any decisions. And thanks for watching
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