Best of the Week
Most Popular
1. Market Decline Will Lead To Pension Collapse, USD Devaluation, And NWO - Raymond_Matison
2.Uber’s Nightmare Has Just Started - Stephen_McBride
3.Stock Market Crash Black Swan Event Set Up Sept 12th? - Brad_Gudgeon
4.GDow Stock Market Trend Forecast Update - Nadeem_Walayat
5.Gold Significant Correction Has Started - Clive_Maund
6.British Pound GBP vs Brexit Chaos Timeline - Nadeem_Walayat
7.Cameco Crash, Uranium Sector Won’t Catch a break - Richard_Mills
8.Recession 2020 Forecast : The New Risks & New Profits Of A Grand Experiment - Dan_Amerman
9.Gold When Global Insanity Prevails - Michael Ballanger
10.UK General Election Forecast 2019 - Betting Market Odds - Nadeem_Walayat
Last 7 days
Welcome to the Zombie-land Of Oil, Gold and Stocks Investing – Part II - 12th Nov 19
Gold Retest Coming - 12th Nov 19
New Evidence Futures Markets Are Built for Manipulation - 12th Nov 19
Next 5 Year Future Proof Gaming PC Build Spec November 2019 - Ryzen 9 3900x, RTX 2080Ti... - 12th Nov 19
Gold and Silver - The Two Horsemen - 11th Nov 19
Towards a Diverging BRIC Future - 11th Nov 19
Welcome to the Zombie-land Of Stock Market Investing - 11th Nov 19
Illiquidity & Gold And Silver In The End Game - 11th Nov 19
Key Things You Need to Know When Starting a Business - 11th Nov 19
Stock Market Cycles Peaking - 11th Nov 19
Avoid Emotional Investing in Cryptocurrency - 11th Nov 19
Australian Lithium Mines NOT Viable at Current Prices - 10th Nov 19
The 10 Highest Paying Jobs In Oil & Gas - 10th Nov 19
World's Major Gold Miners Target Copper Porphyries - 10th Nov 19
AMAZON NOVEMBER 2019 BARGAIN PRICES - WD My Book 8TB External Drive for £126 - 10th Nov 19
Gold & Silver to Head Dramatically Higher, Mirroring Palladium - 9th Nov 19
How Do YOU Know the Direction of a Market's Larger Trend? - 9th Nov 19
BEST Amazon SMART Scale To Aid Weight Loss for Christmas 2019 - 9th Nov 19
Why Every Investor Should Invest in Water - 8th Nov 19
Wait… Was That a Bullish Silver Reversal? - 8th Nov 19
Gold, Silver and Copper The 3 Metallic Amigos and the Macro Message - 8th Nov 19
Is China locking up Indonesian Nickel? - 8th Nov 19
Where is the Top for Natural Gas? - 7th Nov 19
Why Fractional Shares Don’t Make Sense - 7th Nov 19
The Fed Is Chasing Its Own Tail; It Doesn’t Care What You Think - 7th Nov 19
China’s path from World’s Factory to World Market - 7th Nov 19
Where Is That Confounded Recession? - 7th Nov 19
FREE eBook - The Investment Strategy that could change your future - 7th Nov 19
Is There a Stock Market Breakout Ahead? - 6th Nov 19
These Indicators Aren’t Putting to an Economic Resurgence - 6th Nov 19
Understanding the Different Types of Travel Insurance - 6th Nov 19
The Biggest Gold Story Of 2020 - 6th Nov 19
Best Money Saving FREE Bonfire Night Fire Works Show Sheffield 2019 - 5th Nov 19
Is the Run on the US Dollar Due to Panic or Greed? - 5th Nov 19
Reasons Why Madrid Attracts Young Professionals - 5th Nov 19
Larger Bullish Move in USD/JPY May Just Be Getting Started - 5th Nov 19
Constructive Action in Gold & Silver Stocks - 5th Nov 19
The Boring Industry That Hands +500% Gains - 5th Nov 19
Stock Market Chartology vs Fundamentals - 4th Nov 19
The Fed’s Policy Is Like Swatting Flies with Nuclear Weapons - 4th Nov 19
Stock Market Warning: US Credit Delinquencies To Skyrocket In Q4 - 4th Nov 19
Stock Market Intermediate Topping Process Continues - 4th Nov 19
Stock Market $SPY Expanded Flat, Déjà Vu All Over Again - 4th Nov 19
How To Buy Gold For $3 An Ounce - 4th Nov 19

Market Oracle FREE Newsletter

How To Buy Gold For $3 An Ounce

Gold Strong End to the Week on Rising Inflation

Commodities / Gold & Silver 2009 May 15, 2009 - 08:00 AM GMT

By: Adrian_Ash

Commodities

THE PRICE OF WHOLESALE GOLD held steady against most major currencies Friday AM, gaining for the second week running and nearing its best Dollar finish since late March at $928 an ounce.


US stock-market futures pointed lower, meantime, as Consumer Price data showed a faster-than-forecast rate of inflation for April, up 1.9% year-on-year excluding fuel and food.

Six major US life insurers were granted access to the Troubled Asset Relief Program (TARP), which now contains $110 billion of the initial $700bn in rescue funds.

"It was mainly speculative buying that moved the metal upwards," says Wolfgang Wrzesniok-Rossbach, senior analyst at German refining group Heraeus, pointing to this week's 2.1% spike to $930 – a six-week high – in his latest Precious Metals Weekly.

"Dealer-interest was certainly rekindled by the moves in currencies and oil. The largest Gold ETF also recorded a tiny plus – the first one since 9th April."

"In contrast, interest in [physical] Gold Bars this week was again very mellow."

Heading into the typical summer lull in Indian Gold Demand – destination for one ounce in every five sold worldwide last year – "Nothing is happening. Demand is very dull," said a Mumbai bank dealer to Reuters earlier.

"Since the start of the week, demand has dried up," said another.

"I don't see demand re-emerging until gold hits 14,300 Rupees per 10 grams – about $900 an ounce," said a third.

Further ahead, however, HSBC's chief commodities analyst James Steele this week raised the bank's 2009 Gold Price forecast, up from an average of $825 an ounce to $875.

So far this year, the Dollar-price for investors Ready to Buy Gold has averaged $905 an ounce.

"Inflation fears are supporting gold," reckons Steele, and "possible US Dollar weakness remains a potential source of support.

"Stagnant mine output, reduced official sector sales, and robust ETF and retail demand are also supportive."

On the data front Friday morning, the 16 Eurozone nations reported a much worse than expected drop of 4.6% in economic output for the first quarter compared with Jan. to April 2008.

Germany's GDP shrank almost 7% year-on-year, the sharpest fall since 1970.

Frankfurt's Dax index of German stocks neared the Friday close 4.5% lower from last week, while the US currency rose against both the Euro and Sterling but lost ground to the Japanese Yen, trading ¥4 down for the week just below ¥95 per Dollar.

Crude oil fell below $58 per barrel. Government bond prices ticked higher.

The Gold Price in Euros rose to €685 per ounce, just shy of its 2009 average to date at €690.

"If I'd put it in the stock market, I could have lost the lot," says Clark Berger, a private investor in London who's made near-35% gains in gold since August, speaking to Reuters.

"If I'd put it in a bank, it could have gone bankrupt. If I'd stuck it under my mattress, I could have been robbed and had nothing left."

Instead, Mr.Berger chose to Buy Gold, turning £39,400 into £52,500 ($79,250) in eight months by using the award-winning BullionVault service.

"This crisis is not yet over, and there will, in all likelihood, be further tests ahead," said head of the International Monetary Fund (IMF) Dominique Strauss-Kahn at a conference in Vienna this morning.

"Financing conditions have remained tight and credit growth to the private sector has decelerated," said European Central Bank (ECB) vice-president Lucas Papademos at the same event Thursday, "partly as a consequence of the deleveraging of banks’ balance sheets and persisting stresses in the bank wholesale funding markets."

Barclays Bank was meantime rumored to be selling its Barclays Global Investors asset-management division for some $10 billion, while Temasek – the Singapore state's investment managers – said it quit its entire stake in Bank of America during the first 3 months of this year, taking a net $3bn loss on its initial $6bn outlay.

Over in Dubai, "There remain a number of serious concerns, namely a staggering amount of unpaid fees, which our soundings indicate are around £400m [$600m]," said Nelson Ogunshakin, chief executive of the Association for Consulting and Engineering (ACE) to The Telegraph today, after writing to the UK business secretary Lord Mandelson to ask for "political intervention" in reclaiming unpaid money from property developers in the Middle Eastern city.

The United Arab Emirates' biggest developer, Nakheel, is said to be offering just 65 cents on the Dollar to its UK contractors after the real estate market collapsed but its key projects – such as the Dubai Palm and kilometer-tall Burj Dubai tower – remain unfinished.

By Adrian Ash
BullionVault.com

Gold price chart, no delay | Free Report: 5 Myths of the Gold Market
City correspondent for The Daily Reckoning in London and a regular contributor to MoneyWeek magazine, Adrian Ash is the editor of Gold News and head of research at www.BullionVault.com , giving you direct access to investment gold, vaulted in Zurich , on $3 spreads and 0.8% dealing fees.

(c) BullionVault 2009

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

Adrian Ash Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules