A Month in Review: Precious Metals in March



Palladium leads in March

Precious metals showed rising strength at the beginning of 2016. However, March brought some disappointment, with gold losing 1.4% that month after ending January and February with gains. Still, YTD (year-to-date), gold has risen by 14.4%.

Silver, platinum, and palladium saw increases in March, rising by 0.6%, 1.8%, and 8.3%, respectively. But the YTD rises in silver and platinum remain far below that of gold. Palladium has witnessed a marginal overall loss YTD but was the best performer among the four metals in March. Gold, of course, has been the best-performing asset in 2016 amid global risk.

A Month in Review: Precious Metals in March

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Among the 24 commodities listed on the S&P GSCI (Goldman Sachs Commodity Index), gold is at the number one position, whereas silver stands at number five. In March, gold stood at number 16, whereas silver was at 23 on the same index. The above graph shows the comparative performance of gold and the S&P GSCI index over the past year.

Precious metal funds

The rise and fall of precious metals in March have been widely determined by the interest rate change forecasts of the US Federal Reserve. These forecasts also impacted the funds that take their price directions from these metals. Notably, the iShares Gold Trust (IAU) and the SPDR Gold Shares (GLD), which depend heavily on gold, lost 1.4% apiece in March.

Meanwhile, mining stocks that saw downturns due to the turbulence in the precious metal market include IamGold (IAG), Alacer Gold (ASR), and Aurico Gold (AUQ). These three companies tumbled by 7%, 10.4%, and 18.1%, respectively, in March. These three companies together determine 2.5% of the price changes in the VanEck Vectors Gold Miners ETF (GDX).


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