Traditionally, the fate of the commodity prices for gold and silver has been largely determined by the movements in the US Dollar and Federal Reserve rates, and geopolitical issues. The gold price ended the year at US$1,282/oz, slightly lower than at the end of 2017.
Annual gold demand posted a 4% gain over 2018 and reached 4,345 tonnes. The upward trend was primarily driven by a handful of central banks that added 6,511 tonnes to gold reserves in 2018, the highest on record since the US Dollar floated in 1971.
Year-on-year mine production recorded a marginal increase to 3,347 tonnes in 2018. At a global level, environmental concerns and a crackdown on illegal mining affected mine output during the year.
On the back of oil price movements and continued geopolitical tensions, the Russian Rouble weakened by 7% year-on-year from 58.3 RUB/USD in 2017 to 62.7 RUB/USD in 2018. This had a positive impact on the mining sector, resulting in a lower Dollar value for Rouble-denominated operating costs across the board and higher Adjusted EBITDA margins.