Overall country risk improving for gold miners, J.P. Morgan says

|By:, SA News Editor

One of the biggest risks to gold miners - aside from lower gold prices - has been country risk where the companies house their mines, but overall country risk is improving, according to a J.P. Morgan analysis.

The average Fraser PPI score improved for miners in its coverage area, the firm says, as the weighted average of scores using regional NPVs at 5% discount improved 9% over the last survey.

Newmont Mining (NEM +0.9%) enjoys a boost from Peru’s score, which rose from 42 to 48.5, and from improvements in Africa, as “investors get more comfortable with mining in less developed countries,” J.P. Morgan says.

Barrick Gold (ABX +0.3%) also could benefit from improvement in Peru; Argentina deteriorated but could be on the verge of changing this year, which also would give Goldcorp’s (GG +0.5%) prospects a boost.

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