03 August 2011
Surging Gold Price Leaves Coin Prices Lagging. For Now...
BullionSupermarket.com has reported that inertia in Gold Coin prices, combined with a surging Gold price has seen premiums on Gold coins actually fall.
The rapidly surging Gold price on the back of unfolding events in the United States and Europe have meant that premiums on some non auction bullion coins and bars has fallen as some sellers have been slow to re-price their inventories.
With Gold having surged $150 since the start of July, some sellers who had overpriced, slow moving inventories, and been slow to re-price, have suddenly started to look more competitive. At time of writing fixed price Gold Krugerrands were selling from just 0.64% premium.
There are also signs that record prices may also have tempted some precious metal back into the market, particularly Silver, easing the torrid supply situation that prevailed over the past year or so. This additional supply is unlikely to hold down premiums for very long, as past surges in supply have been gratefully absorbed by a veracious demand for bullion coins and bars.
Meanwhile Silver prices, which have been late to join the party this precious metals rally, have seen some opportunities to buy low premium bullion such as Silver Eagle Bullion priced from around 11% premium for bulk lots.
If record or near record precious metal prices hold into the weekend, we could see very stiff competition at auction for bullion coins, which is likely to absorb lower priced fixed price inventory and drive auction premiums higher once more. Particularly as record Gold prices have been seen to tempt newer buyers into the bullion coin markets in the past.