Follow Up To a Turbulent Year

Precious metals prices experienced a turbulent year in 2011 with both a dramatic rise and fall. This brought a great deal of attention to the alternative investment class and also some speculation about what the future may hold.

During 2010, the price of silver had risen by an impressive 80%. The gains continued in early 2011, with silver quickly rising by another 60% and reaching nearly $50 per ounce. After that point, the price crumbled, quickly dropping to $35 and later falling below $30 per ounce.

The price of gold had risen by a more modest 28% in 2010, marking its tenth consecutive annual gain. In 2011, the price of gold following the trajectory of silver, spiking in the summer months to $1,900 per ounce. After a quick drop and rebound, prices receded as low as $1,600 per ounce, where they are likely to finish the year.

The rapid rise in prices was underpinned by strong demand for physical precious metals. This was apparent in the US Mint’s American Eagle bullion coin program, which sold more than one million ounces worth of gold and more than 40 million ounces of silver.

The release dates for both the 2012 Silver Eagle and 2012 Gold Eagle have been announced as January 3, 2012. On this date, authorized purchasers can place their initial orders for delivery of the newly dated coins. Many coin collectors and precious metals investors look forward to these new releases each year to add to their collections or holdings.

As opposed to some earlier years, the US Mint seems to have resolved many of the production issues that had sometimes led to suspensions or rationing of the popular bullion coins. As such, initial sales levels should provide a good indication of whether strong demand for physical precious metals will continue, potentially supporting higher market prices in the coming year.

Posted on December 23, 2011 at 3:16 pm by admin · Permalink
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