| The costs of production and physical demand can offer guidance to where price support may materialise for gold, Barclays said. Prices of $1,190 per ounce suggest that 15 percent of gold production is cash-negative on an all-in sustaining capex basis, the bank said in a note on Monday, while less than 1 percent is negative on a cash-cost basis.
“The sustaining cost of production is a clearer measurement of the cost pressures gold producers face,” it said. “Again, the strength of the dollar offers some respite to producers outside of the US, but given the weak demand environment, any cuts in production are unlikely to tighten the gold market immediately.” The marginal cash cost of production in gold is currently $988 per ounce, it said, with spot gold currently testing key levels around $1,194/1,194.80...............................................Full Article: Source
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