The threat of a trade war between the two global powers, the United States and China, remains quite real. Large-scale additional tariffs have been hinted at from both sides, although tariffs have not yet been implemented. Yle News reported on the topic in a humorous photo summary day
Trump optimistically predicted on Sunday that China would remove trade barriers despite the increased tensions between the countries. China has not been very open to negotiations.
Crude oil and global stock markets fell on Friday as investors worried about the effects of the tariff war on the global economy. This was reported on Sunday by Reuters Kitco News– on the site.
We are keenly interested to see what effects these developments will have on precious metal prices this week.
It is challenging to find new gold production
The upward pressure on gold prices is also generated by the efforts of gold mines to find new production opportunities, reports Kitco News.
"There is a much greater likelihood that the price of gold will move up rather than down," said Iamgold Corp CEO Stephen Letwin to Bloomberg.
Iamgold aims to increase its gold production to 1.35 million ounces over the next four years from the current 875,000 ounces.
Image: Kitco News
SWOT analysis of the culture week
Kitco's expert commentator assessed the events of the previous week using the SWOT model as follows:
Strengths – strengths
- Palladium rose 4.18%
- Analysts are investigating Trump's connections to Russia and suspect the central bank will raise interest rates in June, directing investors to invest in gold.
- China's gold demand in 2017 is the strongest in the context of the previous four years; demand is expected to grow.
Weaknesses – weaknesses
- Gold performed the weakest among precious metals this week, although the price development was positive (0.91%).
- Money flowed out of ETF funds.
- Challenges in increasing gold mining reserves.
Opportunities – opportunities
- Most gold mining companies are in better shape than last year.
- Deutsche Bank published a special report on the gold sector, stating that investors are likely fleeing to gold in an uncertain global climate.
- Trump's political problems and Republican criticisms of Trump's budget are increasing optimism regarding gold.
Threats – uhat
- South Africa proposes changing the minimum amount of mining resources from 26 percent to 30 percent. This could have negative effects and may hinder investments.
- Tanzanian Acacia Mining's actions are under scrutiny as mineral export volumes have been underestimated. Acacia's stock fell by 40 percent.
