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How long will gold Eagle sales sizzle?

Gold American Eagle bullion coin demand during the month of April has spiked to the highest level of the year as buyers apparently attempt to take advantage of lower metal prices.

So far in the month, the Mint has sold 135,500 of the one-ounce coins.

This exceeds the 124,500 sold in the strong opening month of January 2013.

In the ebb and flow of customer demand, the Mint has to contend with the swirl of rapidly changing buyer attitudes that lead to massive fluctuations in sales levels.

Last year monthly sales amounts for the one-ounce Eagles swung from a low of 19,000 coins in the month of April to a high of 129,500 in November.

In 2011, the lowest sales month was 38,500 in November and the highest was January at 130,500.

In 2010 the low month was August at 39,000 one-ounce Eagles while the highest month was May at 190,000.

In 2009 there was much less variation as the market demand was high and the Mint struggled to keep up with it. Eight of the months saw demand of over 100,000, with April at 157,500 pieces. The lowest sales month was May at 65,000.

In the financial crisis year of 2008, Lehman Brothers failed in September, sending demand up sharply, peaking at 176,000 one-ounce coins in December compared to the sleepy market low of 13,000 coins in June before the crisis hit.

Total one-ounce gold Eagle sales in 2008 were 794,000. In 2009, sales rose sharply to 1,325,500. This was the peak following the financial crisis. Then annual numbers began to fall.

For 2010, the annual sales number was 1,143,000. In 2011 the figure was 910,000 and in 2012 it was 667,000.

So far in 2013, 382,000 one-ounce coins have been snapped up. This might mean that the downtrend in annual sales from the post financial crisis high in 2009 will be broken this year.

Then again, sentiment could change swiftly as it has before and take monthly sales to lower levels.

To equal last year’s sales of 667,000 one-ounce coins, demand would need to average a few more than 33,500 a month through the end of December if we figure 8.5 more months left in the year. That looks easy with demand at current white hot levels, but if nothing else has been demonstrated by the gold bullion coin market since the Lehman failure in 2008 it is that monthly demand is changeable – often extremely so.

Buzz blogger Dave Harper is editor of the weekly newspaper “Numismatic News.”

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