US Mint Reports Strong Start to 2016, Gold and Silver Move Higher - Nathan McDonald

February 3, 2016

Both gold and silver have started off the year with a bang. Is this an indication of the year to come, as the global economy continues to teeter on the edge, waiting for the nudge that is going to send it spiralling out of control?

The answer to this question is unknown, but we do know that gold has experienced its best month since January 2015, moving up 5.3% throughout the month – a significant and promising gain.

In addition to this, silver has also moved up 3.2% in the month, despite or possibly because of the story we recently wrote about the closure of a well-known silver mine due to continuing abysmal prices. This adds additional stresses to an already tight market.

Or possibly, it is finally due to the demand that these metals are experiencing at these artificially depressed prices. As Sprott Money Blog has reported on numerous times, precious metals prices at these levels are causing a huge demand in physical metals. This is despite the fact that paper prices continue to remain steady, previous to this month’s positive action.

The U.S. mint is confirming that this demand is showing no signs of lower demand, reporting that the sale of both gold and silver bullion continues to remain strong.

Sales of the ever-popular and widely respected American Gold Eagles hit 124,000 ounces in January 2016, an increase of 53.1% over last year's numbers in which the mint sold 81,000 ounces.

Another positive indication of demand is the fact that the U.S. Mint was forced to ration their sale of American Silver Eagles due to a silver shortage. Despite this, they still experienced their fourth best month ever in sales since the coins were introduced in 1986.

Silver coin sales were reported of 5,962,500. This is an increase of 153.9% over the previous month, and an increase of 7.2% year over year.

Once again, the numbers don't lie. This points again to the tale of two markets that I have so extensively written about. The physical market is alive and well— it is the paper market that is depressed, battered and bruised.

Smart investors continue to put stock and faith in precious metals. These artificially depressed prices are eventually going to break free of their paper shackles and move to new highs. It is only a matter of time.