AXMIN Inc (TSXV: AXM)
AXMIN Inc. (TSXV:AXM) is a Canadian-based exploration and development company with a strong focus on central and West Africa.
After the U.S. election results were announced, both the U.S. dollar and Treasury yields rose, reducing gold’s investment appeal. Simultaneously, U.S. stock markets and cryptocurrencies surged significantly following Trump’s victory, attracting substantial capital and creating a siphon effect on the gold market. For a time, Trump seemed to have become the “terminator” of the long-standing gold bull market.
From early January to the end of October 2024, New York gold prices rose by about 35%. However, after Trump’s victory was confirmed on November 6, gold prices dropped by 3.1% that day, with a cumulative decline of over 6% by November 12. This led many investors to conclude that the global gold bull market had ended.
In November 2024, Michael Michaud, the President and CEO of Red Pine Exploration Inc. (TSXV: RPX, OTCQB: RDEXF) , a Canadian precious metals exploration company, was interviewed by METALS 100. He elaborated on Red Pine Exploration’s flagship project, the Wawa Gold Project, located in the Michipicoten Greenstone Belt approximately 2 kilometers southeast of the Municipality of Wawa in Northern Ontario.
Market data appears to support this view.
The World Gold Council noted that in the first week of November, global gold ETFs shrank by about $809 million, with most selling pressure coming from North American investors. COMEX data reflected similar trends. Managed money positions in gold saw a net decrease of about 74 metric tons during the same period, down 8% from the previous week, indicating a large unwinding of pre-election hedge positions.
Despite the current pressure on gold, many market watchers remain optimistic about its long-term prospects, with Trump ironically being one of the reasons.
Experts point out that Trump’s policies of tax cuts, tariffs, and high government spending could lead to higher inflation rates in the long term. Gold has traditionally been a hedge against inflation, and if the U.S. economy experiences “reflation,” gold might regain its appeal among investors looking to preserve purchasing power. Additionally, if the new administration increases spending, the U.S. deficit could further expand, affecting the credit rating of U.S. Treasuries.
The return of U.S. inflation is not just a scare tactic.
The latest U.S. CPI data shows that the Consumer Price Index rose 2.6% year-over-year in October, up 0.2 percentage points from September, while the core CPI increased by 0.3% to 3.3%. The subsequent downward trends in sub-indicators such as used car prices, housing costs, and core inflation are insufficient, suggesting that inflation may be quite stubborn. An upward trend in inflation is becoming increasingly evident.
Finally, the fundamental thesis of this round of the gold bull market has not changed.
The world is experiencing unprecedented changes in a century, with de-globalization trends surging, big power rivalry, and geopolitical conflicts continuously escalating. Against this backdrop, the global financial system, based on the U.S. dollar, is showing signs of crisis, and there is a growing sense of urgency for “de-dollarization” led by BRICS countries. Gold is an important international safe-haven asset and a crucial component of national central bank reserves, and its strategic importance is becoming increasingly apparent in today’s complex international landscape.
