Gold Investor Index Hits 4-Month High as Silver Surges

By Miguel Perez-Santalla

Private investor sentiment towards gold bullion rose in August to its best level since April’s 16-month high, according to the latest Gold Investor Index from BullionVault.

As the price of gold recovered to $1400 per ounce, erasing the last of June’s 15% plunge, the online bullion exchange saw its measure of investor sentiment rise to 53.8 from July’s 10-month low of 52.6.

bvchart_091113The Gold Investor Index measures the balance of gold buyers versus sellers on BullionVault, the world’s largest provider of physical bullion ownership online. The Index peaked at 71.7 in September 2011. A reading of 50.0 would signal a perfect balance of buyers and sellers.

The big jump in the GII I reflects the uncertainty in the global arena and disappointing U.S. economic reports. Turmoil in Egypt and war in Syria are big contributors to global instability. On the domestic front, the weak new home sales report triggered a gold rally that was fueled by the poor durable goods order report. Although Europe reported slightly improved GDP, it was not enough to allay other global economic fears.

Silver Surges

Sales of Silver Eagles, an often quoted barometer of the silver market, continue to surge. The U.S. mint reports sales of Silver Eagles are on pace to be up 54.4% year-on-year, based on their figures for August. The precious metals market is achieving a sort of equilibrium, as Gold took a big hit, investors sought out Silver. More investors are becoming comfortable with the precious metals market, and are able to re-balance their precious metals portfolios with greater ease.

From May – July, 2013 The volume of Gold sold outpaced buys by 20% globally, within the BullionVault exchange. At the same time, investors were snapping up Silver.

Silver buys outpaced sales by 22% in value during the same period within the global BullionVault exchange. The U.S. was slightly more cautious possibly dumping gold for silver, with 15% more Gold sales than buys in US Dollar Terms. While the white metal saw 15% more buys than sales during that time period.

In August, BullionVault users aggressively bought silver at a rate of nearly 40% over sales.

About Miguel Perez-Santalla

Miguel Perez-SantallaMiguel Perez-Santalla, Vice President of BullionVault in New York, has more than 30 years’ experience in precious metals industry. Previously he was Vice President of marketing for the multinational precious metals concern Heraeus in New York. Miguel has been recognized by his peers as an expert on precious metals topics. He frequently presents at the International Precious Metals Institute and other venues. He is host of  New York Markets Live, a weekly Internet radio show that examines all aspects of the precious metals market.

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