02 Jun 2017
A cashless utopia? Dream on!
Steve Worthington |
Although its share of usage continues to fall, cash will always play a part in our spending.
20 Jun 2017
The gilded outlook for gold
It’s a good time to be in gold. Increasing political uncertainty and rising geopolitical risk is likely to provide strong support for gold in the short term - despite the spectre of higher interest rates in the US.
Indeed, ANZ Research expects gold prices to push past $US1,300 an ounce over the next 12 months.
Demand for gold has positive long-term prospects as well. Emerging markets will drive demand for physical gold for some time. The substitution effect will ultimately be positive as the institutional investor base in Asia continues to grow.
China and India are already the world’s largest gold consumers so demand will increase as incomes rise in those countries.
" China and India are already the world’s largest gold consumers so demand will increase as incomes rise in those countries."
Beyond being the world’s largest producer and consumer of gold ANZ believes China will eventually dominate the price recovery process as Asia’s financial centres open up.
There is no reason why Shanghai should not become a major centre for gold trading provided the appropriate institutional and legal reforms take place.
In the long term central banks are likely to increase gold holdings. Most of the buying will come from emerging-market central banks as they move closer to developed-world levels.
The supply side is also supportive of price as gold mines can’t expand rapidly. Prices below $US1,000 an ounce are unsustainable in the long term.
Gold is a store of wealth in unstable times and while global finance has weathered a decade of storms the future is uncertain.
Daniel Hynes is a senior commodities analyst at ANZ
The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.
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23 May 2017
What’s powering the lithium boom?
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Some $A500 million in Chinese investment has seen a sevenfold increase in lithium mines in WA.