The Sign that Gold will Climb Back

he gold price recently retracted. Just shy of $1,700 per oz, the gold price fell hard to just below $1,500. But an interesting occurrence is signalling that the gold price will very soon resume its upward trend.

Because with so much selling, you would expect the gold supply to be in abundance. But not so, according to BullionStar, a gold supplier in Singapore. Their blog post dated 14 March 2020 explains that company is experiencing difficulty to get physical gold bullion.

Some points from their blog post:

1. There is a worldwide shortage of physical gold.

2. The physical and paper prices of gold have decoupled, prompting them to increase their premium on physical gold price to cover the difference. In other words, the price of physical gold is higher than paper gold.

We have to assume is that people are hoarding physical gold. For now, gold on exchanges and ETFs are still trading as usual. Very soon though, the prices will have to couple again and the gold price climb will resume.