SunSirs: Precious Metal Market will Wait for theResistance of Competitive Products

According to the data of the SunSirs, the price of precious metals in recent February has shown a U-shaped running trend. Today, the price has risen significantly. At present, the price is close to the peak in the first ten days of October 2019, which is still far from the peak in the year in early September 2019.

A precious metals analyst from SunSirs believes that the sharp rise in precious metals prices on January 3 is on the one hand driven by geopolitical factors. It is reported that tensions between the United States and Iran in the Middle East have intensified. On the other hand, the expectation of monetary policy tends to be loose. The domestic central bank lowered the reserve ratio on Wednesday (January 1), and the expectation of interest rate reduction in the domestic market strengthened. Internationally, after four interest rate hikes in 2018, the Federal Reserve opened the interest rate reduction channel in 2019, cutting interest rates three times in July, September and October, respectively, and the target range of the federal fund interest rate was reduced to the current level of 1.5% - 1.75%, at the same time Many central banks have cut interest rates, such as the Central Bank of Brazil, the Central Bank of Saudi Arabia, the Central Bank of Bahrain, the Central Bank of Kuwait and the Central Bank of the United Arab Emirates.

Whether the future precious metals can break through the high level in 2019 depends on the dynamic changes of the physical demand and supply of precious metals, on the other hand, on the factors of capital, such as the ability of attracting gold in the stock, bond and other competitive markets, whether the cost performance ratio of precious metals can outperform other channels, and the risks and uncertainties in other markets, or will drive the investment demand of precious metals.

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