What does an above-normal warming in the Pacific Ocean equatorial waters off the coast of South America have to do with gold? At first glance. Nothing. But, the global weather phenomenon known as El Nino is brewing and some meteorologists place high odds that it will officially develop this year.
Jodie Gunzberg, global head of commodities at S&P Dow Jones Indices ran some numbers looking back at eight historical El Nino events since 1983. “The metals showed positive performance in most of the periods with average returns of 25.3% and 8.9% from industrial metals and precious metals, respectively,” Gunzberg wrote in a research note.
Sound strange? Maybe not.
Find out why on kitco.com