Coins & Money

Have Gold & Silver Coin Buyers Vanished in a Digital World?

Inflation is hot and geopolitical risks are even hotter. It should be a great time for gold and silver buyers. That might have at least been the case if the Federal Reserve wasn’t at the front-end of a massive expected interest rate hike cycle. It would be easy to ask if this was due to a greater interest in cryptocurrency, Bitcoin and other digital assets. That said, Bitcoin isn’t exactly having a stellar year by any real measure.

Apparently, the U.S. Mint has also observed lower sales of its American Eagle coins. The Mint noted a decline in all of its precious metals coins in April. The move follows a multi-year high recorded in early March after the panic from the Russian invasion of Ukraine. Since that peak, gold is down nearly 10%.

According to the monthly U.S. Mint data, only about 88,000 ounces of gold was sold in April of 2022. That is down from about 155,500 ounces sold in March.

Silver’s prices are far lower in total dollars, but the U.S. Mint sold only about 850,000 ounces in April. That’s down from about 1.08 million ounces in March.

We did not see the data on platinum sales in April, but the Mint had recorded about 14,200 ounces of platinum sales in March.

In gold coin sales, even the lower priced one-tenth of an ounce sales plummeted in April to 25,000 coins. That was the same as February, but down from 75,000 coins in March and down even worse compared to the 195,000 coins in January.

Gold was last seen trading down around $1,875.00 per ounce, still up about 3% year-to-date while equity indexes have performed quite poorly. As for the “new gold” measured by Bitcoin, it is still down about 17% year-to-date and down about 45% from its highs in 2021.

There is a solid lesson in market history here at a time that the U.S. stock market just saw its worst 4-month start since prior to World War II: When markets are in freefall and forced selling comes into play, anything that can be used as a source of funds will be used as a source of funds. That means, gold, Bitcoin, gainers, losers… anything that is actively traded, still liquid and still subject to fluctuating market prices.