7 WWWNEW G O L D C O M TSXNGD NY SE Am er ic an NG D Forei gn Exch ange Rate s The Com pan ys ke y opera t ions are in Canad a while rev enu e is ge nerate d in US dollars As a result the Comp an y ha s foreign curre n cy expo sure with respe c t to co sts not de nominate d in US dollars Ne w Gold s operating re sults an d cash flows are infl uen ced by chang es i n va riou s e x chan ge rates agai nst the US dollar The Compan y ha s exp o sure to the Can adian do llar throug h New Afton Rainy Ri ve r and Blackwate r as well as through corp ora t e administration co sts T he Compa n y a l so ha s expo sure to the Mexi can pe so throug h its re clamatio n acti vities at Cerro San Pedro The spot Ca n adian dolla r wea k e ned ag ainst the US do llar durin g the first quarter of 2020 Similarl y th e ave r ag e Ca n adian d o llar a gain s t the averag e US do llar for the m onths e nde d March 31 20 20 de cre a sed whe n co mpa r ed to the prio ryea r pe riod The str ength ening o r wea k eni ng of the Cana dian d o llar impa cts co sts in US dollar term s a t the Compa n y s Ca nadi an oper ation s as well as ca pital cost s at the Compan y s Can adian de velo pment propert y a s a si gnifica nt po rti on of o perating an d capita l co sts are de nominate d i n Can adian d o ll ars In the first qu arter of 202 0 the Co mpa n y ente r e d into foreig n e x ch ange fo rward contract s in o r de r to he dge the Compa n ys spen ding i n Canadi an dollars The Comp an y ha s hedge d 2 00 million US dollars per month at ave r age Can adia n dollar to U S dollar forei gn exch ang e rate of 140 for the pe riod of April 202 0 to Decembe r 2020 For a n an alysis of the imp a ct of foreign excha nge flu c tuation s o n operating co sts refer to th e Re v iew of Operating Mi nes se ction s fo r Rain y Ri ver and Ne w Afton Economic Outlook The LBMA pm gold price has in crea se d by 6 sin c e the start of 2020 Unce rt ainty aroun d the sh ort and longte rm e c o nomic i m pa ct s of COVID1 9 co ntinue s t o ca use in cre a se d volatility in equit y markets and ha s encourage d inflows into safeha v e n assets su ch a s US treasu r ies an d gold Against this econ omic backd rop gol d held in exchang etrade d produ cts recorde d the largest ever qu arte rl y net inflows in US dollar te rms coin cidi ng wit h the rise in g o ld pri c e s to multiyear hi g h s Prospe cts for gold are encoura ged b y seve ral structu r al factors Mine sup p ly ha s been plate a u ing as hig h quality dep osi t s be come m o re difficult to find and m o re exp e n s ive to develop and mine Expl ora t ion bud gets have been cu t in recent ye ars in crea sin g the likeliho od that suppl y will rem a in muted eve n in the face of increa sing g o l d prices Econo mic events can ha ve sig n ifica n t effects o n the pr i c e of g o ld throug h currency rate flu c tuations the relative stre n g th of the US dollar gold suppl y and deman d and macro e cono mic factors such a s intere st rates a nd inflation exp e cta t ions Mana g e ment antici p at es that the longte rm e c o nomic e n vi ro nment sh ould pro v ide sup p o rt for preci o us metal s an d for gold in particula r and believes the pro s pe cts fo r the busi n e s s are favou r abl e Duri ng the first qua rter of 2020 Lo ndo n Metal Excha nge LME cop per pri c e s declin ed b y approxi m atel y 22 Wea k e r market condi tions for co pp er were dri v e n by COVID1 9 s imp a ct o n global m anuf acturi ng a n d redu ce d de m and fro m Chi na whi c h co ntinue s to be t he wo rld s l a rge s t con s u m er of the m e tal De spite recent market weak ness supply cu ts in k e y copper produ c i ng juris d ic tions and rec o v e ring Chines e demand sho u ld provi d e sup port for cop per p r i c e s