Yeah let's start with that. Why is Goldman just offered up right now given everything that I would imagine would actually boost
the price. We believe gold prices are holding up remarkably well given the
pressures that the market's facing at the moment in terms of the dollar's strength. Such a sharp move. In the past we've seen
gold breaching that seventeen hundred level and testing the downside. But here we've seen prices holding up quite well. The
physical market's been quite price elastic but also says concerns that inflation may remain elevated for a longer period
of time. That hasn't seen its core investors or ETF investors heavily shorting gold just yet. Yes they've scaled back their
exposure. We've seen that redemptions across the across the gold ETF impact July's on pace to be its fastest month of outflows in
almost a year since March last year. And tactical positioning has been scaled back close to neutral. So it hasn't. Right.
Sorry. Sorry. We were breaking up there. I have to wonder though it doesn't have quite in terms of living of his reputation as an
inflation hedge or a safe haven. I wonder though what would it take then to spark the selling pressure to actually start moving
more and more inflows into those ETF. You're mentioning we think we've seen the bull from the downside being priced in
when we've previously seen the Fed hiking at the pace that it has been. And we expect another 25 basis points at the July
meeting next week. Gold prices could be expected to come under a lot more downside pressure. Say if you go back to 1980 where we
saw this sort of pace hiking gold on an annualized basis lost 20 percent. But for gold prices to really rally we think we need to
see a few factors come into play. Firstly a stabilization in those ETF outflows. Secondly we need to see if that physical
market is still price elastic. We're now entering the seasonal slow period for consumption for gold. So that floor is quite
vulnerable in the near term. But also we need to see that the market has already priced in a lot of this downside risk. And if
we look at that tactical positioning we can see that it was actually quite elevated with the first hike back in March but
now it's being rapidly scaled back. So we think there's actually scope for a relief rally coming up to the July FOMC meeting
where we could see a little bit of a bounce and perhaps prices edging back towards Central 15 the near term.
So give me just a look at some of the other key risks or developments in industry here as it pertains I guess to some of
the targets and then and where prices go the possible or ongoing if you will a recovery in the chip shortage. Why is that
important. This has had so many implications for not just the markets
directly impacted like platinum and palladium was has an impact in terms of global auto production but also secondary effects in
terms of the inflation risks as well. So for the gold market it's had a secondary impact and that's inflation was expected to
start to ease in the middle of this year. But now that's perhaps been pushed DAX into some point in 2023. And the inflation which
has been exacerbated by the supply side challenges that were expected to ease. So now we're seeing central banks raising
rates at a much faster pace than was anticipated. Source. Yeah but for the PJM market it's particularly interesting because
it's going to be the turning point of the chip shortages that results in the balance back in global auto production. That's
likely to see that industrially buys precious metals start to fall. So gold and silver perhaps towards the end of this year or
certainly into the staff of 2023. So that's going to be a critical factor in determining that upside risk across the
precious metals. You mentioned the more the demand picture we've seen in terms of
China. You know there's been a bit up in terms of industrial metals on the prospect of more stimulus. It has helped the likes
of silver just a bit. I'm just wondering though there's been reports from Chinese banks that they're going to suspend
investors from taking new positions in gold and silver by August. How much does that actually muddy the demand picture for
you for the entire precious metals complex. China has a baring
factor in terms of how critical its demand is. The largest exposure is perhaps in palladium but we've already seen a
slowdown in plaited consumption coming from China with the slowdown in auto production. In fact you've seen an increase in
platinum demand a sense a view that longer term we'll start to see substitution between platinum and palladium favouring
platinum. And that's perhaps being exacerbated by Russia's Russian invasion of Ukraine. But a slowdown in China's demand
for the gold and silver market is perhaps more important in determining that downside at least in the near term. And the
downside support for gold critical level is really around 60 90 and that. And here we need to see response is interest from both
India and China as well as central banks around the world providing that buffer on the downside for the silver market.
Most of the strength has actually come from India. Well I think across the metals complex as a whole China's locked on
implications. The fact that we might see a slow growth recovery in the second half of the year is critical in determining how
solid that flows back to the downside not the upside is still very much being driven by the macro picture and the strength of
the dollar. And when we'll start to see a turning point and investor interest is already way so that the physical market's
going to be key and the downside.