Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Global Warming ClImate Change Mega Death Trend - 8th Apr 24
Gold Is Rallying Again, But Silver Could Get REALLY Interesting - 8th Apr 24
Media Elite Belittle Inflation Struggles of Ordinary Americans - 8th Apr 24
Profit from the Roaring AI 2020's Tech Stocks Economic Boom - 8th Apr 24
Stock Market Election Year Five Nights at Freddy's - 7th Apr 24
It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- 7th Apr 24
AI Revolution and NVDA: Why Tough Going May Be Ahead - 7th Apr 24
Hidden cost of US homeownership just saw its biggest spike in 5 years - 7th Apr 24
What Happens To Gold Price If The Fed Doesn’t Cut Rates? - 7th Apr 24
The Fed is becoming increasingly divided on interest rates - 7th Apr 24
The Evils of Paper Money Have no End - 7th Apr 24
Stock Market Presidential Election Cycle Seasonal Trend Analysis - 3rd Apr 24
Stock Market Presidential Election Cycle Seasonal Trend - 2nd Apr 24
Dow Stock Market Annual Percent Change Analysis 2024 - 2nd Apr 24
Bitcoin S&P Pattern - 31st Mar 24
S&P Stock Market Correlating Seasonal Swings - 31st Mar 24
S&P SEASONAL ANALYSIS - 31st Mar 24
Here's a Dirty Little Secret: Federal Reserve Monetary Policy Is Still Loose - 31st Mar 24
Tandem Chairman Paul Pester on Fintech, AI, and the Future of Banking in the UK - 31st Mar 24
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold Rises on "Perfect Storm" Safe haven Investment Demand

Commodities / Gold and Silver 2010 May 24, 2010 - 08:37 AM GMT

By: Adrian_Ash

Commodities

Best Financial Markets Analysis ArticleTHE PRICE OF GOLD in all currencies ticked higher in Asia on Monday, briefly touching $1190 an ounce before easing back in London as a rise in Asian stock markets failed to spur European equities.
 
The Euro and Sterling both fell hard vs. the Dollar. US crude oil contracts slipped below $70 per barrel.


The rate of interest offered by government bonds fell yet again as prices rose, with 10-year US Treasury yields falling below 3.20% per year for the first time in 12 months.

Silver prices today slipped back after rallying 3.7% from Friday's two-week low.

"Gold looks to have found a short-term bottom last Friday near $1166," reckons a note from Mitsui's Hong Kong office.

"Both physical and investment demand [are] picking up."

"We have been looking for a retracement in gold," agrees Standard Bank's commodities team here in London, "and now believe that it has largely run its course.

"We are once again witnessing some physical buying interest and re-stocking [in] Asia."

Looking at the gold futures and options market, "Gold is not overbought" says Standard of the latest data from US regulator the CFTC.

In the week-ending last Tuesday – and with gold already trading 2% off its record top of the week before – "large speculators" cut their betting on higher gold prices by 0.5%.

That was offset, however, by a rise in private investors using the futures and options market to bet on higher gold prices, leaving the non-industry "net long" position of bullish minus bearish contracts unchanged and equal to 1009 tonnes of metal.

"All of the turmoil and problems we've seen in Europe is just another reminder that there's a lot of value in gold as a safe haven," says Evan Smith, co-manager of $2 billion in funds at US Global Investors Inc. in California, speaking to Bloomberg.

"You could see gold go up another $1000."

"You've got a perfect storm with no apparent solution," says "low-profile billionaire" Thomas Kaplan in an interview with the Wall Street Journal published Saturday.

"If the world does well, gold will be fine," says the head of Tigris Financial Group. "If the world doesn't do well, gold will also do fine...but a lot of other things could collapse."

Today the new UK coalition government – slated to borrow some £200 billion this financial year ($288bn) – announced £6.2 billion ($8.9bn) of public-sector cuts, focusing on "low priority and back office functions."

The German government said it will cut public spending by €10bn next year (€12.3bn) to comply with the new "debt guillotine" added to Germany's constitution.

New debt issues from Eurozone banks and business fell to a 2010 low of barely $1 billion last week, the Financial Times reports, after Germany banned "naked short-selling" in the debt market.

On Saturday, the central bank in Spain assumed control of the CajaSur bank in Cordoba, holding some 0.6% of the banking sector's financial assets.

Swiss bank UBS's new "FX mega-trends" report forecasts a decade of "super volatility" ahead in the world's currency markets.

Estimates from Capital Economics' Toronto office says the M3 measure of US money supply – discontinued by Federal Reserve statisticians in 2006 – shrank by more than 5% over the last 12 months.

The US White House said president Obama "endorses" South Korean retaliation for last month's sinking of a naval ship by a North Korean torpedo, which killed 46 sailors.

"People are buying Krugerrand gold coins like crazy," says one German wholesaler, quoted by the newswires.

During the first three weeks of May, the US Mint sold more than four tonnes of one-ounce Eagle coins.

Comparing last week's 46-tonne growth in exchange-traded gold trust-fund holdings worldwide, investment demand now outstrips new mining output according to Bloomberg News.

By Adrian Ash
BullionVault.com

Gold price chart, no delay | Free Report: 5 Myths of the Gold Market
Formerly 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 2010

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.


© 2005-2022 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