U.S. Mint sales of gold and silver coins may be on pace for the lowest totals in more than a decade, said the consultancy Metals Focus.
Price is a factor that affects coin sales. Further, the 2016 election of U.S. President Donald Trump may have played at least some role in the decline, since some U.S. citizens who were previously buying both gold and guns under a Democratic administration now may feel less need to do so, the consultancy said.
“The most recent data published by the U.S. Mint confirms that U.S. coin and bar demand remains subdued,” Metals Focus said in a report Tuesday. “While we await…publication of final November sales figures, it is unlikely there will be a significant improvement from currently available figures.”
As of the Metals Focus report, American Eagle gold coins sold by the U.S. Mint so far in November stood at just 8,000 ounces for a year-to-date total of 230,000. This was down from 260,000 ounces for January to November 2017.
American Eagle silver coins sales stood at 1.27 million ounces, with the year-to-date total standing at 14.8 million, compared to 17.3 million during the first 11 months of 2017.
“This performance is all the more disappointing, given the jump in September sales, especially for silver Eagles,” Metals Focus said. “The drop in silver prices at that time proved sufficiently steep to encourage a return of retail investors. As a result, sales that month touched 2.9Moz, their highest since January (which tends to benefit from interest in newly-dated coin issues). However, the September jump proved to be short-lived as prices then recovered sufficiently to resume their largely range-bound trading.”
Comex December gold hit a low for the year of $1,167.10 an ounce in mid-August. December silver hit its 2018 low so far of $13.86 in mid-November.
Metals Focus pointed out that gold-coin sales picked up in July after a price fall, but did not do so again in August after further price weakness. Then, while prices dipped below $1,200 late in the third quarter and early in the fourth, the decline was too small to encourage a significant revival in retail interest, Metals Focus said.
“Aside from the price impact, a second issue, which continues to affect the U.S. market, concerns the change of U.S. administration in 2016,” said Metals Focus. “Prior to this, [former President] Obama had targeted greater gun control. The threat that firearms would be confiscated encouraged a sense of siege mentality among some sections of the U.S. public, to the benefit of gun and coin sales. In contrast, Trump’s more favorable stance towards U.S. gun ownership has resulted in weaker firearm sales and, with it, falling precious metals demand from these consumers.”
Metals Focus projected that full-year 2018 American Eagle gold-coin sales will be below 250,000.
“In so doing, this would represent the lowest full-year total since 2007,” the consultancy said. “With regards to silver, annual sales may fall short of 17Moz, which would stand at an 11-year low.”
