How interest rate hikes and a lack of scarcity brought the U.S. Mint’s American Eagle gold coin sales to the lowest levels in a decade

The 2018 American Eagle One-Ounce Gold Proof Coin. Hover to zoom.

U.S. government data regarding the Mint’s recent sales figures has provided us with some fascinating revelations. American Eagle gold coin sales have fallen to their lowest in 11 years, not seeing so few sales since April 2007. 4,500 ounces of American Eagle gold coins were sold in April 2018, which is 25 percent less than the amount sold around the same time just last year. March was even worse, being 29 percent lower than April. Silver, on the other hand, has risen 10 percent since the same time last year. What’s going on?

American Eagle coin sales in 2018 by month. Source: The United States Mint.

In a previous article published on March 30, 2018, entitled, “What’s going on with gold?” I stated this:

As of now, gold is trading right below its peak levels in 2017, but enthusiasts expect it to increase in the near future. In 2018 alone, gold has grown 3.5 percent. Due to concerns of an incoming trade war between the United States and China, the Federal Reserve is expected to lower its interest rates, which is beneficial to the gold industry because it makes gold investment more appealing than Treasury bonds and other savings. For investors, McDonald suggests considering the Gold Miners ETF (GDX), since the fund’s assets have reached its highest levels since the end of 2017. Let us know in the comments if you think gold is doing well or not!

Well, it turns out that those of us that thought that the Federal Reserve would lower its interest rates were wrong! Fate would have it that in late April, the Federal Reserve announced that the U.S. economy is remaining on track for continued growth and that more hikes in interest rates were to materialize in the near future rather than the predicted decrease. This news led to a decrease in spot gold prices, which, coupled with an increasing variety of appealing investment alternatives and the increased re-selling of gold coins on the market, is eating away at the demand for the Mint’s newly issued gold coinage. Since a decrease in demand is what appears to be hurting the Mint’s sales of the American Eagle gold coins, the most logical step to increase sales would be to find ways to increase demand. I have seen many a collector comment either on blogs or in message boards that the Mint needs to lower its mintage limit of new products to increase the demand and hype for new coins. I would have to personally say that I agree with these avid collectors.


Scarcity and demand hold an intimate relationship in any economic endeavor, and one of the reasons that older coins remain in such higher demand compared to newer issues is because they are far scarcer in quantity. Even if the scarcity were artificially driven, I think that the Mint would benefit by minting far fewer new issues than they currently do, many of which have no mintage limits whatsoever. Many collectors dream of being the owner of a coin or set which has only one or two known authentic specimens. Rather than putting out fewer new issues with virtually unlimited mintages, the Mint might perhaps consider the opposite sales approach — producing more new issues with lower mintages. The collector community is hungry for new Mint issues that create lines around the street corner like the first time the Kennedy half dollar was introduced in 1964.

The obverse of the 2018 American Eagle One-Ounce Silver Proof Coin.

It’s been some time since I’ve seen any of the Mint’s products sell out on its website, but gold, in particular, appears to be suffering the worst of the impact. This is a shame since I really do enjoy the design of the American Eagle gold (and silver) coins on an aesthetic level. Even though the markets are quite often unpredictable, there are things that the Mint can still do to protect American interest in gold coins. This is not to disparage the Mint, or anybody who works there, just a piece that voices the concerns of the collector community. We want the Mint, and the hobby, to succeed for many generations to come.

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Comments

  1. Daveinswfl says

    Demand is down because the public has been convinced that the block chain and derivative “coinage” (bitcoin et al) are more desirable than PMs!

    If they blow up, PMs will regain popularity

  2. Ernesto says

    I also think that with so many options, for gold coins, that is pulling buyers away. Plus most other gold coins are 24k. The AGE is just 22k. Why pay almost the same price for 22k?

  3. sharks2th says

    All government issued one ounce gold bullion coins have one ounce of gold regardless of whether they are 24k, 22k, etc. (same for the fractionals) . The American Eagle weighs more than an ounce due to the alloy used. In addition to one ounce of gold you also get approximately one gram of silver and 1.8 grams of copper. So if the coins are the same size and price, you’re getting the silver and copper for free with the eagle. The drawback is the purity level is slightly less with the eagle alloy. This is where you have the choice between the eagle (22k) and the buffalo (24k) from the us mint.

    The gram of silver gives you about 50 cents worth of unpurified silver at today’s silver price. The alloy also makes the eagle slightly stronger and less easily damaged than the softer buffalo.

  4. David says

    Personally I think these gold bullion coins have too high of a premium over spot prices to really make them a worthwhile purchase. Further, the premiums on US Mint Silver Proof Sets are significantly higher than the silver content they contain. And paying $49.95 or whatever for a W minted Silver Eagle from the mints website is beyond absurd.

  5. sharks2th says

    All of the premiums on bullion products have become outrageous. You used to be able to get one ounce gold eagles for a 3 percent premium. Premiums now run close to 5 percent on one ounce gold eagles. When silver was in the 2.50 to 4.00 range proof eagles were $18. Dollarwise the premium has gone up drastically on silver proof eagles.

    Cag has the right idea of buying old gold for minimal premiums. The bonus with old gold is you have some history in your hand.

    The premiums on all of the mint products have become unreasonable and unsustainable if the mint expects to sell products.

    At least the mint is going back to some of the old benefits like free shipping (after 3 orders or subscriptions). They still didn’t have their system set up right for the free shipping. I had received more than 3 subscriptions when I placed an order and I had to call them to get the shipping refunded when they billed me for shipping.

  6. cagcrisp says

    “Due to concerns of an incoming trade war between the United States and China, the Federal Reserve is expected to lower its interest rates …”

    It’s hard for me to believe that Anyone in the Mainstream would believe in March of 2018 that the Fed would be Lowering interest rates.

    The question for a Mainstream economists is whether the Fed will Raise 3 or 4 times in 2018, Not Lowering rates…

    That’s a head scratching statement…

  7. cagcrisp says

    “Rather than putting out fewer new issues with virtually unlimited mintages, the Mint might perhaps consider the opposite sales approach — producing more new issues with lower mintages. ”

    That is Exactly what I have been saying for years:

    Lower and Lower Mintages, Higher and Higher Prices and More and More Gimmicks…

    That IS what the Mint will do and it will NOT be what the Mint SHOULD do.

    That will just be Following what other world Mints are Currently doing.

    …AND…

    …That is a Failed Strategy…

  8. Daveinswfl says

    New mint slogan : (be sure to sing the tune!)

    We’re following the others, the others, the others….

  9. cagcrisp says

    17AJ 2017 ATB SILVER UNC 5 OZ – EFF MNDS 16,769 +16
    17AK 2017 ATB SILVER UNC 5 OZ – DOUGLASS 17,307 +18
    17AL 2017 ATB SILVER UNC 5 OZ – OZARK 17,153 +16
    17AM 2017 ATB SILVER UNC 5 OZ – ELLIS ISLAND 17,616 –
    17AN 2017 ATB SILVER UNC 5 OZ – G R CLARK 14,731 –
    18AJ 2018 ATB SILVER UNC 5 OZ – PIC ROCKS 16,137 + 61
    18AK 2018 ATB SILVER UNC 5 OZ – APOSTLE ISL 15,211 +86

  10. cagcrisp says

    16EA 2016 AM EAGLE SILVER PROOF 1 OZ 588,214 +406
    16EB 2016 AM EAGLE GOLD PROOF 1 OZ 24,105 + 2
    16EC 2016 AM EAGLE GOLD PROOF 1/2 OZ 5,947 +4

  11. cagcrisp says

    17EA 2017 AM EAGLE SILVER PROOF 1 OZ 379,206 + 305

    17EB 2017 AM EAGLE GOLD PROOF 1 OZ 8,885 +5
    17EC 2017 AM EAGLE GOLD PROOF 1/2 OZ 2,440 +4
    17ED 2017 AM EAGLE GOLD PROOF 1/4 OZ 4,419 +6
    17EF 2017 AM EAGLE GOLD PROOF 4-COIN SET 9,811 –

    17EG 2017 AM EAGLE SILVER UNC 1 OZ 146,015 +1,835

    17EJ 2017 AM EAGLE PLATINUM PROOF 1 OZ 8,891 –

    17EL 2017 AM BUFFALO GOLD PROOF 1 OZ 15,810 –

  12. cagcrisp says

    18EA 2018 AM EAGLE SILVER PROOF 1 OZ (W) 267,531 +1,924

    18EB 2018 AM EAGLE GOLD PROOF 1 OZ 3,032 + 29
    18EC 2018 AM EAGLE GOLD PROOF 1/2 OZ 1,094 (10)
    18ED 2018 AM EAGLE GOLD PROOF 1/4 OZ 1,701 + 75
    18EE 2018 AM EAGLE GOLD PROOF 1/10 OZ 6,743 (20)
    18EF 2018 AM EAGLE GOLD PROOF 4-COIN SET 4,752 +50

    18EJ 2018 AM EAGLE PLATINUM PROOF 1 OZ 9,617 + 34

  13. cagcrisp says

    18CA 2018 WWI CENTENNIAL SILVER PROOF 46,109 + 529
    18CB 2018 WWI CENTENNIAL SILVER UNC 17,714 +119

    18CC 2018 WWI CENTENNIAL COIN & MEDAL – ARMY 15,058 (18)
    18CD 2018 WWI CENTENNIAL COIN & MEDAL – AIR SERV 12,038 (10)
    18CM 2018 WWI CENTENNIAL COIN & MEDAL – NAVY 11,907 (14)
    18CN 2018 WWI CENTENNIAL COIN & MEDAL – MARINES 12,162 (13)
    18CP 2018 WWI CENTENNIAL COIN & MEDAL – COAST GRD 9,377 (10)

  14. cagcrisp says

    18CE 2018 BREAST CANCER GOLD PROOF 8,935 +5
    18CF 2018 BREAST CANCER GOLD UNC 3,850 + 7
    18CG 2018 BREAST CANCER SILVER PROOF 26,711 + 381
    18CH 2018 BREAST CANCER SILVER UNC 10,131 +100
    18CJ 2018 BREAST CANCER CLAD PROOF 15,167 +111
    18CK 2018 BREAST CANCER CLAD UNC 9,128 (11)

  15. cagcrisp says

    17XA 2017 AM LIBERTY 24K GOLD 1 OZ 28,417 + 25
    17XB 2017 AM LIBERTY SILVER MEDAL (P) 54,912 –
    17XC 2017 225TH ANN ENHANCED UNC SET 210,418 –
    17XD 2017 AM LIBERTY SILVER 4-MEDAL SET 30,643 + 24

  16. John Q. Coinage says

    Cag thanks for the #s. To me the 2o18 W Proof ASE has a lowball future, does anyone care will be the ? 20k 1/1oth Liberty medal, that was just about 2k above….my 1st day sales # pick! 215 for 1/10th, AU @ $1,320… 132 v. 215…. almost a 100% markup to spot, need answers look @ the prices & the kids, iPhone, etc., not many carry ca$h, & dummy restaurants open here now proudly NOT taking ca$h, excuse, it’s dirty!.. PS> THe food sux & they have a customer fall off…. duh Wild & Freely Greasy Chicken

  17. Sith says

    Like the floor of the crater on top of the Kilauea volcano when it collapsed,and sent a pool of lava back underground, only to push its way back to the surface somewhere in the East Rift Zone. They collapsed the price of gold and silver (anyone remember all the margin increases, including raising them 5 times or 85% in 8 days)…and it surfaced in Bitcoin. IMHO, the mint can do what it wants at this point, but Americans will not regain an interest in PMs until its too late. Hopefully Bitcoin will still be accepted during that crisis, as they will not be able to afford PMs.

  18. Scott says

    I could be wrong, but I don’t remember a previous mint offering of three different years of gold eagles.

  19. joe says

    Personally I have a couple of coin types I still collect from the Mint, but have lost interest in the others for the most part. As stated above, too many gimmicks and too high premiums. I would also add the newer designs are ‘meh’ compared to the older designs, and have become WAY too politically correct. Gold is gold; silver is silver… I’m not interested in paying huge premiums for ugly coins that preach PC to placate those inside the beltway.

  20. cagcrisp says

    @Scott ,”I could be wrong, but I don’t remember a previous mint offering of three different years of gold eagles.”

    I Agree.

    That tells you something about Gold offerings…

  21. Tom P. - MA says

    The lure of cryptocurrencies right now is that you could turn $10,000 into $100,000 in a relatively short time period. You could also turn it into zero. There’s great potential out there along with blatant scams if you don’t know what you are doing.

    I buy $10,000 worth of gold or silver and at the end of the year I will have roughly $10,000 worth of gold or silver. It’s the equivalent of savings accounts right now. Of course that could change tomorrow or it could take years.

    World mints have even sucked the fun out of bullion silver pieces for me. 5 years ago you could pretty much buy up every smaller silver piece and not go broke. Now there are so many “limited issues” from so many countries, it’s impossible to keep up.

  22. earthling says

    Just for laffs… and to copy the Aussie and New Zealand Mints, the US Mint needs to put out an American Gator Silver Coin. These might be very popular down in the swampy Southern States that have Gator.

    As an added boost to sales , a few Coins could have some DC Beltway Swamp scenery in the background. I’d be wanting a few of those, just in case Trump ever does “drain the swamp”.

  23. MarkInFlorida says

    I don’t care if gold and silver and platinum go up or down. I’m just stacking, week after week, month after month, and some day I, or my kids, will sell at a much higher price. But bullion, not overpriced Mint baubles.

  24. Daveinswfl says

    The swamp will never be drained!
    Congress approval ratings around 18%, yet the sheeple return 85% of the incumbents.
    I guess they believe “everybody’s Congressman is a swamp creature EXCEPT FOR MINE!”

    Thus far this month 31 first spouse coins have been resold on eBay at prices from $657 – whatever the seller accepted on a BIN/best offer $1399 Lucretia Garfield MS70. That’s about 4 a day. That’s really not bad for coins that no one is interested in. Most were in the $650-750 range and graded…..which means they are being liquidated at a loss.

    Does anyone have the site address to look up those eBay best offer accepted prices?

  25. KML in KY says

    I have an assortment of certified moderns for sale on Great Collections right now.

    I also sent them a complete set of “P” pucks 2010 to date in Mint packaging which they have not listed yet.

    I will post what I get for them after they sell.

  26. Erik H says

    JBK, I read MNB daily but find there’s very little to post about lately. It seems like MNB was more popular when in was Mint News “Speculator” Blog.

    Mister Kairu, I’m like you. I like searching for foreign silver at close to melt. Lots of great finds for very little $$. Lots of stuff I’ve bought have mintages under 20k and sometimes 10k. It goes to show you that supply / demand is everything (knowledge too). I find that this is a great FREE reference for foreign coins https://en.numista.com

  27. Throckmorton says

    There is no justification to ever recognize a gator….however a Tennessee Volunteer coin would have broad appeal!

  28. Scott says

    @ Tom, you are 100% right about that. Also the gold eagle design is getting boring and that doesn’t help. If the mint would at least switch to the original St. Gaudens reverse, sales would improve, but sales will never recover with premiums at the current levels.

  29. A different Jeff says

    Hmmm… putting out more issues with lower mintages to drive demand, especially for gold. Isn’t that what the mint did since 2007 with the First Spouse issues? And wan’t that a rousing success?

  30. John Q. Coinage says

    If there is really a staleness that effects sales, the USM & Congress might consider a swap to the $10 Indian obverse for the ASE & use the old $20 $t.G reverse…. or a FLowing Hair $1….

  31. Kevin says

    It’s the premium hikes that are driving consumers away. This years prices were outrageously high over spot prices. Also take into account the high availability of back years as low as about 3% over spot on many years. There is no reason to buy current year issue. Better to just wait a couple years when the price slides on them which it will.

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