The strike action is holding back an estimated 32,000 ounces of gold a week of production at Anglo Gold Ashanti and 2,300 ounces a day at Gold Fields. Approximately 41% of South Africa’s gold output is idled.
The Chamber of Mines which is leading discussion with unions is set to meet again today. If mining companies are forced to lay off illegally striking employees, supply will be hampered for some time to come. Although gold prices fell during the week, supply concerns are a supporting factor helping to keep gold prices above $1765/oz.
Key events to watch this week: European heads of state summit
This week the main focus of attention will be the European heads of state summit where a new austerity program for Greece will be considered, indications of Spain’s intention to accept a bailout package and other key European issues will be
discussed.
China’s 3Q GDP will be scrutinized for signs of resilience (or lack thereof), US and China retail sales, Germany’s ZEW survey and US existing home sales will also be watched closely for indications of relative economic health.
ETFs Physical Swiss Gold Shares (NYSEArca: SGOL)
