Best of the Week
Most Popular
1. The Trump Stock Market Trap May Be Triggered - Barry_M_Ferguson
2.Why are Central Banks Buying Gold and Dumping Dollars? - Richard_Mills
3.US China War - Thucydides Trap and gold - Richard_Mills
4.Gold Price Trend Forcast to End September 2019 - Nadeem_Walayat
5.Money Saving Kids Gardening Growing Giant Sunflowers Summer Fun - Anika_Walayat
6.US Dollar Breakdown Begins, Gold Price to Bolt Higher - Jim_Willie_CB
7.INTEL (INTC) Stock Investing to Profit From AI Machine Learning Boom - Nadeem_Walayat
8.Will Google AI Kill Us? Man vs Machine Intelligence - N_Walayat
9.US Prepares for Currency War with China - Richard_Mills
10.Gold Price Epochal Breakout Will Not Be Negated by a Correction - Clive Maund
Last 7 days
US Housing Market Real Terms BUY / SELL Indicator - 16th July 19
Could Trump Really Win the 2020 US Presidential Election? - 16th July 19
Gold Stocks Forming Bullish Consolidation - 16th July 19
Will Fed Easing Turn Out Like 1995 or 2007? - 16th July 19
Red Rock Entertainment Investments: Around the world in a day with Supreme Jets - 16th July 19
Silver Has Already Gone from Weak to Strong Hands - 15th July 19
Top Equity Mutual Funds That Offer Best Returns - 15th July 19
Gold’s Breakout And The US Dollar - 15th July 19
Financial Markets, Iran, U.S. Global Hegemony - 15th July 19
U.S Bond Yields Point to a 40% Rise in SPX - 15th July 19
Corporate Earnings may Surprise the Stock Market – Watch Out! - 15th July 19
Stock Market Interest Rate Cut Prevails - 15th July 19
Dow Stock Market Trend Forecast Current State July 2019 Video - 15th July 19
Why Summer is the Best Time to be in the Entertainment Industry - 15th July 19
Mid-August Is A Critical Turning Point For US Stocks - 14th July 19
Fed’s Recessionary Indicators and Gold - 14th July 19
The Problem with Keynesian Economics - 14th July 19
Stocks Market Investors Worried About the Fed? Don't Be -- Here's Why - 13th July 19
Could Gold Launch Into A Parabolic Upside Rally? - 13th July 19
Stock Market SPX and Dow in BREAKOUT but this is the worrying part - 13th July 19
Key Stage 2 SATS Tests Results Grades and Scores GDS, EXS, WTS Explained - 13th July 19
INTEL Stock Investing in Qubits and AI Neural Network Processors - Video - 12th July 19
Gold Price Selloff Risk High - 12th July 19
State of the US Economy as Laffer Gets Laughable - 12th July 19
Dow Stock Market Trend Forecast Current State - 12th July 19
Stock Market Major Index Top In 3 to 5 Weeks? - 11th July 19
Platinum Price vs Gold Price - 11th July 19
What This Centi-Billionaire Fashion Magnate Can Teach You About Investing - 11th July 19
Stock Market Fundamentals are Weakening: 3000 on SPX Means Nothing - 11th July 19
This Tobacco Stock Is a Big Winner from E-Cigarette Bans - 11th July 19
Investing in Life Extending Pharma Stocks - 11th July 19
How to Pay for It All: An Option the Presidential Candidates Missed - 11th July 19
Mining Stocks Flash Powerful Signal for Gold and Silver Markets - 11th July 19
5 Surefire Ways to Get More Viewers for Your Video Series - 11th July 19
Gold Price Gann Angle Update - 10th July 19
Crude Oil Prices and the 2019 Hurricane Season - 10th July 19
Can Gold Recover from Friday’s Strong Payrolls Hit? - 10th July 19
Netflix’s Worst Nightmare Has Come True - 10th July 19
LIMITLESS - Improving Cognitive Function and Fighting Brain Ageing Right Now! - 10th July 19
US Dollar Strength Will Drive Markets Higher - 10th July 19
Government-Pumped Student Loan Bubble Sets Up Next Financial Crisis - 10th July 19
Stock Market SPX 3000 Dream is Pushed Away: Pullback of 5-10% is Coming - 10th July 19
July 2019 GBPUSD Market Update and Outlook - 10th July 19

Market Oracle FREE Newsletter

Top AI Stocks Investing to Profit from the Machine Intelligence Mega-trend

Gold Sold to Raise Cash as Tsunami Hits Stocks and Oil

Commodities / Gold and Silver 2011 Mar 11, 2011 - 09:49 AM GMT

By: Adrian_Ash

Commodities

Best Financial Markets Analysis ArticleTHE PRICE of gold held at 10-session lows against the Dollar in London on Friday as world stock markets fell – and the US currency rose – after a powerful tsunami hit the Japanese coast north of Tokyo.

Japanese savers saw gold prices fall hard, losing 2.6% from this week's new three-decade highs, despite a drop in the Yen.


Trading 2.4% below Monday's new Dollar record near $1445 per ounce, prices to buy gold held flat from last week's finish for Euro and Sterling buyers.

At big institutions, "[Managers] like gold because they can sell it easily to raise cash to defend positions elsewhere," said economist and editor of the eponymous investor letter Dennis Gartman to Bloomberg.

"They will be doing so today.”

But "I suspect Japan won't be a major market mover today for gold prices once the initial impact wears off," reckons Tom Kendall at said Credit Suisse, speaking to Dow Jones Newswires.

"Gold's focus is likely to remain the Middle East and whether there are any sizeable protests in Saudi Arabia."

The world No.1 oil producer's "day of rage", however – called for by internet activists – instead left the capital Riyadh quiet and heavily policed, press reports said.

Pro-Gaddafi forces in Libya claimed to have re-taken the key oil port of Ras Lanuf. Some 13 Christians were reported killed in Egypt after protesting the destruction of a church by "a Muslim mob".

Over in Tokyo, where the Nikkei share index closed Friday 1.7% lower, the Bank of Japan promised "ample" liquidity and set up an emergency task-force to support banking operations. Interest rates are already at zero.

European stock markets meantime extended this week's drop to hit 3-month lows, and oil prices also fell further, but copper stemmed its worst weekly drop since June.

Silver bullion fell 7.1% below Monday's new 3-decade highs, trading at a 6-session low of $34.50 per ounce.

"Gold buying opportunities [are] on the horizon," says Standard Bank's  latest Precious Metals Monthly, prepared by London's GFMS consultancy.

This week's new Dollar records came from "very strong physical demand in the major physical buying regions, fanned by a combination of inflationary fears and political tensions," says the report, with Western savers also raising their gold investment again.

"There have been signs of some profit taking and scrap sales, but the market remains tight...High global liquidity points to further medium-term gold price increases."

Steady gold accumulation continues amongst emerging-market investors, says the latest analysis from French bullion bank Natixis, "in contrast to western and Middle East investors who have been buying gold as a reaction to the North African situation."

China's new Lion Gold Fund – allowed in Jan. to put $500m of Chinese investors' money into gold-backed trusts overseas – this week received a licence to double that exposure.

Neighboring Vietnam's communist government on Thursday stopped issuing Gold Trading licenses, and vowed to ban gold-denominated bank accounts – now holding some $5.4 billion for Vietnamese savers hit by 12% inflation and repeated devaluation's of the Dong currency.

"Gold and silver prices [will also] benefit from...a re-emergence of worries about peripheral European sovereigns," says Natixis.

Greek and Portuguese bonds fell hard once again on Friday, driving new borrowing costs up towards new Euro-union highs, as Eurozone leaders met in Brussels to discuss the European Stability Mechanism (ESM) – the planned replacement for €500 billion European Financial Stability Facility (EFSF) created amid the Greek and Irish debt crises of 2010.

"The most common question we've had all week," says Deutsche Bank's Jim Reid, quoted by the FT's Alphaville, "has been why are markets so sanguine about the continued deterioration in the European peripheral market?

US Treasury bonds rose fast on Friday, nudging 10-year yields down to new 2011 lows near 3.36% as stock markets sank, despite this week's news that giant bond-manager Pimco has cut Washington's debt from its flagship fund entirely.

"[Pimco's move] seems a bit extreme but there's no doubting that the market faces headwinds," says Steve Barrow at Standard Bank, "which is one reason why we feel that 10-year yields will be above 4% by the end of the year."

Rising yields on government bonds mean that bond-prices are falling.

By Adrian Ash
BullionVault.com

Gold price chart, no delay   |   Buy gold online at live prices

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 2011

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.


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


Comments

sc
11 Mar 11, 16:48
Joking

You're joking right? or if you're not you're suggesting that in the midst of a natural disaster ,literally as it was happening, you thought people were saying sell my gold I need to buy a bag of cement ,or a bag of rice.

There I was thinking people bought gold as a safe haven when in a disaster they sell it.Silly me.


Don
11 Mar 11, 21:38
No Sense

This article makes no sense, no matter what subject it is addressing. For example, the Vietnamese government wants to ban gold-denominated banking accounts, and how does that help Vietnamese savers hit by 12% inlfation and repeated devaluation of Dong currency? Sheesh!


Post Comment

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

6 Critical Money Making Rules