The Perth Mint recently reported that gold sales saw a significant drop for the month of December. The mint reported a whopping 55% month-over-month decline in sales for the lowest total since June 2018.
The mint reported that silver sales also saw a steep decline, dropping by a staggering 21% month-over-month for the lowest total since August 2018.
These figures are significant as the Perth Mint refines some 90 percent of all newly-mined gold in Australia making it the world’s second-largest producer behind China.
Gold sales declined from 64,308 ounces in November to just 29,186 in December. This figure represents total sales of minted bars and coins.
The drastic decline in sales volume could be attributed to several factors. Going into the end of the year, investors may have simply been content sitting on current holdings. End of year tax issues and position squaring may have also played a role.
The rise in gold prices may have kept a lid on sales as well. After trading near the $1200 level just a few short weeks ago, the gold market has come to life. Prices have climbed nearly $100 per-ounce in that time frame and investors may be taking a wait-and-see approach to see if any significant dips occur.
Silver sales declined from 876,446 ounces in November to 692,971 in December. This figure represents total sales of minted bars and coins.
Silver sales also fell short and there could be several factors behind the weak figures. Like the gold market, silver has also seen a strong burst of upside in recent weeks. In fact, silver was trading near $14 per-ounce just several weeks ago. Since that time, however, prices have been on the offensive and have gained significant ground, rising by nearly $2 per-ounce.
Patient investors may be simply biding their time to wait and see if any significant dips occur that may present a strong buying opportunity.
Given the improving market fundamentals and technical posture in these markets, any significant dips in price have the potential to be aggressively bought. In addition, further clarity on the state of the global economy, the ongoing U.S./China trade war and interest rates could also spur buying as the New Year gets into full swing.