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Gold Falls as Janet Yellen Indicates a Higher Interest Rate (Continued from Prior Part) Gold and interest rates
Gold prices have historically had a close relation to US real interest rates. As gold is a non-interest bearing asset, higher interest rates pull money into the Treasuries as cash flows lure investors. Gold, on the other hand, carries no intermediary cash flows, and investors are only hoping to earn by the price increase in gold. Thus, the looming fear of the Federal decision on a rate hike is playing its game on gold and other precious metal prices. Gold is now trading at its lowest mark seen since February 2010. The Federal decision of moving the rates above the zero mark for the first time in almost ten years is causing precious metals to lose their lustre.
Interest rates and the US dollar
Interest rates have a close to direct relation with currency. When a country raises its rates, money is expected to flow into the country by way of foreign investments. The new incoming money could raise the demand for the US dollar and thus pose a rise. The rising US dollar once again causes harm to the dollar-denominated assets and pushes its prices lower. Gold has posted an 11.6% loss on a year-to-date basis. Similarly, silver, platinum, and palladium have also lost 11.9%, 31.7%, and 33.8%, respectively, on a year-to-date basis.
The growing likelihood of the rate hike has caused money managers to cut their bullish position in gold-based funds drastically. Investors have dumped close to 400 tons of gold on COMEX. Some other ETFs that have posted losses in price in the current year include Global X Silver Miners ETF (SIL) and the Market Vectors Junior Gold Miners ETF (GDXJ). Mining companies that have seen plunging share prices include Centerra Gold (CG), Barrick Gold (ABX), and Coeur Mining (CDE). These three companies together contribute 8.8% to the Market Vectors Gold Miners ETF (GDX).
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PRODUCTEUR |
CODE : CDE |
ISIN : US1921085049 |
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ProfilIndicateurs de MarchéVALEUR : Projets & res.Communiqués de PresseRapport annuelRISQUE : Profile actifsContactez la cie |
Coeur Mining est une société de production minière d'argent et d'or basée aux Etats-Unis D'Amerique. Coeur Mining est productrice d'argent, d'or, de cuivre, de plomb et de zinc en USA, au Mexique, en Australie, en Argentine et en Bolivie, en développement de projets d'argent et d'or en Argentine et en Bolivie, et détient divers projets d'exploration au Mexique. Ses principaux projets en production sont ROCHESTER MINE - NEVADA PACKARD en USA, ENDEAVOR et BROKEN HILL en Australie, PALMAREJO au Mexique, MARTHA MINE en Argentine et SAN BARTOLOME en Bolivie, ses principaux projets en développement sont ROCHESTER et KENSINGTON en Bolivie et JOAQUIN en Argentine et ses principaux projets en exploration sont KENSINGTON/JUALIN en Argentine, LAKE VICTORIA GOLD BELT en Tanzanie et EL REALITO, GUADALUPE et LA PATRIA au Mexique. Coeur Mining est cotée au Canada, aux Etats-Unis D'Amerique et en Allemagne. Sa capitalisation boursière aujourd'hui est 303,6 millions (277,4 millions €). La valeur de son action a atteint son plus haut niveau récent le 21 novembre 1997 à 99,38 , et son plus bas niveau récent le 22 janvier 2016 à 1,62 . Coeur Mining possède 47 442 200 actions en circulation. |