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Gold May 29, 2020 09:30:36 AM

Gold Markets Resilient Despite Supply Chain Disruptions

Paul Ploumis
ScrapMonster Author
The global gold production reported 3% decline during the initial quarter of 2020.

Gold Markets Resilient Despite Supply Chain Disruptions

SEATTLE (Scrap Monster):  The latest market update published by the World Gold Council (WGC) highlights the strength of gold market amidst disruptions caused to supply chains on account of Covid-19 pandemic impacts.

According to WGC, the pandemic has significantly disrupted the gold supply chain. The lockdown restrictions during the initial quarter of the year have impacted both gold mining and recycling activities to a great extent. However, the impacts were modest when compared with the scale of disruption to other industries. Many refiners were forced to halt their operations. Also, the disruptions in commercial flight services also resulted in challenges to transportation of physical gold.

ALSO READ: WGC Foresees Gold's Strong Return in 2020

Despite all the above mentioned supply and logistics challenges, the overall liquidity in the gold market continued to remain robust, clearly highlighting the inherent strength of the gold industry. Gold’s supply chain demonstrated resilience in the midst of adverse market conditions, WGC report said.

The global gold production reported 3% decline during the initial quarter of 2020. However, this reduction was relatively modest considering the scale of the pandemic. Also, recycling activity registered 4% decline, falling to its lowest level in two years.

Meantime, the inflows into gold ETFs, which hit the highest quarterly levels in four years during Q1 this year, have continued to remain robust in April and May.

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