Top 20 Mining & Crypto Equities: The great wall of dollar resistance

In our late September Top Mining & Crypto Report, we made the case that the dollar was about to hit a dead end against its rivals including precious metals. While we were too optimistic about the prospects for the yen, the dollar has indeed fallen against other major currencies since the report, notably the Chinese renminbi and euro (yes it is true). On a composite basis, the broad dollar index has failed to move above its fall 2023 highs despite the weak yen. Most importantly, the dollar peaked against gold within days of our September report.

Anthony Blinken and Xi Jinping in Beijing

We continue to hear talk of an impending devaluation of the Chinese currency against the dollar. This would be a headwind for commodities and potentially gold. However, we expect China to resist devaluing its currency unless it is hit with tariffs against key exports by the European Union or the United States.

China's renminbi bottomed against the dollar last September

Short of a trade war flaring up, China appears motivated to keep the renminbi stable as it seeks to position itself as a strong player in the BRICS which is currently pursuing an alternative payment system to the dollar. The alternative system is being spearheaded by Russia and is expected to promote the use of local currencies in trade settlement instead of the dollar. If all goes to plan, the BRICS payment system will be unveiled at the BRICs ministerial summit in Kazan, Russia which is scheduled between October 22nd and 24th.

The competition to make the Top 20 this month was stiff this month as all names have sunny INK Edge outlooks. To keep reading Log in and download the report or join us for access.