Miners see the golden lining
Gold miners AngloGold Ashanti and Gold Fields will be among the few winners of the Brexit crisis, ratings agency Moody's said yesterday.Gold Fields jumped nearly 13% and AngloGold nearly 10% on Friday, swimming against a flood that saw global stock markets lose $2-trillion after the U K voted to leave the EU.The Brexit shock sent gold rallying 8.5% to a two-year high of $1358/oz in a few hours of the close of voting stations - gold's biggest rally since the global financial crisis of 2008, Moody's said.At the same time the dollar strengthened as investors bought US treasuries, driving a 4% depreciation of the Australian dollar and a 9% depreciation of the rand relative to the US dollar."The depreciated Australian dollar and South African rand are credit-positive for gold miners AngloGold Ashanti [Baa3 stable] and Gold Fields [Ba1 stable], whose free cash flow will increase with lower operating costs for their Australian and South African mines in US dollar terms, along with a higher US dollar gold price increasing revenues," Moody's assistant vice-president Douglas Rowlings wrote.AngloGold derives about 14% of its gold from Australia and 26% from South Africa , while Gold Fields derives 10% from South Africa and 43% from Australia. ..
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