| New lows for the buck... Rand is performing too well, along with Canadian dollar and Australian dollar. This alone argues for a higher gold price. However, producers in South Africa will get pressured, as gold may drop in Rand terms, while rising in dollar terms, which will push their profits lower, not higher. If you want to short a metal based on "deflation", silver, platinum, paladium, etc. may be better shorts, since gold is a currency, not a commodity. It will take longer for silver to recover lost "currency" status, so it will follow gold higher later. |
