Lombardi Financial addresses current gold bullion prices going into a historically strong period for the metal.
New York, United States – July 23, 2014 /MarketersMedia/ –
Lombardi Publishing Corporation (www.LombardiPublishing.com), a 28-year-old consumer publisher that has served over one million customers in 141 countries, is weighing in on gold bullion prices as the commodity enters a period of seasonal strength.
Historically, the period from July 12 to October 9 is the optimal time to invest in gold bullion; trading in gold bullion has been profitable 11 out of the last 14 periods. Over the last quarter century, gold bullion has outpaced the S&P 500 by 4.7% per period, which bodes well for gold bullion investors. (Source Vialoux, D., “Get ready for gold bullion’s season of strength,” The Globe and Mail, July 10, 2014; www.theglobeandmail.com/globe-investor/funds-and-etfs/etfs/get-ready-for-gold-bullions-season-of-strength/article4403228/.)
“Year-to-date, gold bullion prices are up nine percent; the S&P 500, on the other hand, is up around seven percent. Thanks to a number of additional factors, this gold season could see gold make even stronger gains,” says economist and lead contributor Michael Lombardi. “Demand for gold bullion remains strong in mainland China and India, the two largest consumers. In 2013, demand for gold in China soared by 32% to record levels. Accounting for about 28% of global usage, China overtook India as the largest consumer of gold last year.” (Source: “China Overtakes India as Top Gold Consumer,” The Wall Street Journal, February 18, 2014; http://online.wsj.com/news/articles/SB10001424052702304675504579389261432501856.)
Lombardi explains that demand for gold from India remains robust. In 2013, gold sales in India jumped 13% year-over-year to 975 tonnes despite the government implementing several restrictions to curb imports. Gold smuggling also remains popular in India; according to some estimates, as much as 20 to 30 tonnes of gold gets smuggled into India each month. Traditionally, gold sales increase in the run up to the Diwali wedding season, says Lombardi, which starts this year on October 23.
Central banks continue to be net importers of gold; in fact, 2013 was the fourth year in a row that central banks were net imports of the precious metal, being the net sellers before Lehman Brothers collapsed. That means that in 2013, while gold prices were tumbling, central banks around the world, including India, China, and Russia, were shoring up their vaults with gold bullion. And continue to do so. (Source: Grubb, M., “Gold Demand Trends Full Year 2013,” World Gold Council web site, February 18, 2014; www.gold.org/supply-and-demand/gold-demand-trends/back-issues/gold-demand-trends-full-year-2013.)
Over the next few months, the launch of the Shanghai Gold Exchange’s global trading platform and the Dubai Gold and Commodities Exchange will create greater demand and interest in gold.
“Geopolitical tensions in hot spots like Ukraine, Russia, Israel, and Palestine could send investors looking for a safe haven investment like gold bullion,” Lombardi concludes. “Tack on financial instability in Portugal and the eurozone and economic disappointment in the U.S. and, to a lesser extent, China, and gold could become even more attractive to investors during this period of seasonal strength.”
Founded in 1986, Lombardi Publishing Corporation, which has served over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more information on Lombardi Publishing Corporation, visit www.LombardiPublishing.com.
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