Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Key Time For Stock Markets: Bears Step Up or V-Shaped Bounce - 24th Sep 20
Five ways to recover the day after a good workout - 24th Sep 20
Global Stock Markets Break Hard To The Downside – Watch Support Levels - 23rd Sep 20
Beware of These Faulty “Inflation Protected” Investments - 23rd Sep 20
What’s Behind Dollar USDX Breakout? - 23rd Sep 20
Still More Room To Stock Market Downside In The Coming Weeks - 23rd Sep 20
Platinum And Palladium Set To Surge As Gold Breaks Higher - 23rd Sep 20
Key Gold Ratios to Other Markets - 23rd Sep 20
Watch Before Upgrading / Buying RTX 3000, RDNA2 - CPU vs GPU Bottlenecks - 23rd Sep 20
Online Elliott Wave Markets Trading Course Worth $129 for FREE! - 22nd Sep 20
Gold Price Overboughtness Risk - 22nd Sep 20
Central Banking Cartel Promises ZIRP Until at Least 2023 - 22nd Sep 20
Stock Market Correction Approaching Initial Objective - 22nd Sep 20
Silver Bulls Will Be Handsomely Rewarded - 21st Sep 20
Fed Will Not Hike Rates For Years. Gold Should Like It - 21st Sep 20
US Financial Market Forecasts and Elliott Wave Analysis Resources - 21st Sep 20
How to Avoid Currency Exchange Risk during COVID - 21st Sep 20
Crude Oil – A Slight Move Higher Has Not Reversed The Bearish Trend - 20th Sep 20
Do This Instead Of Trying To Find The “Next Amazon” - 20th Sep 20
5 Significant Benefits of the MT4 Trading Platform for Forex Traders - 20th Sep 20
A Warning of Economic Collapse - 20th Sep 20
The Connection Between Stocks and the Economy is not What Most Investors Think - 19th Sep 20
A Virus So Deadly, The Government Has to Test You to See If You Have It - 19th Sep 20
Will Lagarde and Mnuchin Push Gold Higher? - 19th Sep 20
RTX 3080 Mania, Ebay Scalpers Crazy Prices £62,000 Trollers Insane Bids for a £649 GPU! - 19th Sep 20
A Greater Economic Depression For The 21st Century - 19th Sep 20
The United Floor in Stocks - 19th Sep 20
Mobile Gaming Market Trends And The Expected Future Developments - 19th Sep 20
The S&P 500 appears ready to correct, and that is a good thing - 18th Sep 20
It’s Go Time for Gold Price! Next Stop $2,250 - 18th Sep 20
Forget AMD RDNA2 and Buy Nvidia RTX 3080 FE GPU's NOW Before Price - 18th Sep 20
Best Back to School / University Black Face Masks Quick and Easy from Amazon - 18th Sep 20
3 Types of Loans to Buy an Existing Business - 18th Sep 20
How to tell Budgie Gender, Male or Female Sex for Young and Mature Parakeets - 18th Sep 20
Fasten Your Seatbelts Stock Market Make Or Break – Big Trends Ahead - 17th Sep 20
Peak Financialism And Post-Capitalist Economics - 17th Sep 20
Challenges of Working from Home - 17th Sep 20
Sheffield Heading for Coronavirus Lockdown as Covid Deaths Pass 432 - 17th Sep 20
What Does this Valuable Gold Miners Indicator Say Now? - 16th Sep 20
President Trump and Crimes Against Humanity - 16th Sep 20
Slow Economic Recovery from CoronaVirus Unlikely to Impede Strong Demand for Metals - 16th Sep 20
Why the Knives Are Out for Trump’s Fed Critic Judy Shelton - 16th Sep 20
Operation Moonshot: Get Ready for Millions of New COVAIDS Positives in the UK! - 16th Sep 20
Stock Market Approaching Correction Objective - 15th Sep 20
Look at This Big Reminder of Dot.com Stock Market Mania - 15th Sep 20
Three Key Principles for Successful Disruption Investors - 15th Sep 20
Billionaire Hedge Fund Manager Warns of 10% Inflation - 15th Sep 20
Gold Price Reaches $2,000 Amid Dollar Depreciation - 15th Sep 20
GLD, IAU Big Gold ETF Buying MIA - 14th Sep 20
Why Bill Gates Is Betting Millions on Synthetic Biology - 14th Sep 20
Stock Market SPY Expectations For The Rest Of September - 14th Sep 20
Gold Price Gann Angle Update - 14th Sep 20
Stock Market Recovery from the Sharp Correction Goes On - 14th Sep 20
Is this the End of Capitalism? - 13th Sep 20
The Silver Big Prize - 13th Sep 20
U.S. Shares Plunged. Is Gold Next? - 13th Sep 20
Why Are 7,500 Oil Barrels Floating on this London Lake? - 13th Sep 20
Sheffield 432 Covid-19 Deaths, Last City Centre Shop Before Next Lockdown - 13th Sep 20
Biden or Trump Will Keep The Money Spigots Open - 13th Sep 20
Gold And Silver Up, Down, Sideways, Up - 13th Sep 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Markets Flat Following ECB LTRO, "Next Target for Silver" is September High

Commodities / Gold and Silver 2012 Feb 29, 2012 - 10:39 AM GMT

By: Ben_Traynor

Commodities

Best Financial Markets Analysis ArticleWHOLESALE MARKET gold bullion prices hovered around $1785 an ounce Wednesday morning London time, while stocks and commodities were also broadly flat following the European Central Bank's latest attempt to boost the liquidity held by the continent's banks.

Silver bullion meantime hit $37.36 per ounce, its highest level since last September.


"The next target [for silver] is $39.78, the September 2011 high," says the latest technical analysis from gold bullion dealing bank Scotia Mocatta.

Wednesday's London Fix price for silver was $37.23 per ounce – a 10.8% monthly gain over the January 31 fixing. By this measure, the Dollar silver price has seen its biggest calendar month percentage gain since October. Sterling and Euro silver prices have both recorded their biggest calendar month gains since last July.

Gold meantime touched $1790 per ounce for the first time since November during Wednesday's Asian trade. By Wednesday lunchtime, spot gold in Dollars was headed for a monthly gain of 2.8%.

A total of 800 European banks borrowed €529.53 billion from the ECB's three year longer term refinancing operation, the ECB announced Wednesday. This compares with 523 banks who borrowed €489.19 billion at the last 3-Year LTRO in December.

In addition to the increased amount of borrowing, analysts estimate that a greater proportion will be so-called new liquidity – as opposed to existing debt that has been rolled over.

"The number of banks participating...signals that a lot more small banks looked for the money and it is likely they will pass it on to the economy," reckons Laurent Fransolet, London-based head of fixed income strategy at Barclays Capital.

"So the impact may be bigger than with the first one."

However, "there is a big difference between stopping the rot and starting a recovery," says this morning's note from Standard bank currency analysts Steve Barrow and Jeremy Stevens.

"It is always possible that Eurozone politicians shy away from the tough fiscal and institutional decisions that will be required to end this crisis, if they feel that the ECB's cash is doing the job for them."

The Euro fell slightly against the Dollar immediately following the LTRO, though it recovered much of the loss by lunchtime. European stock markets barely moved, although yields on 10-Year Portuguese government bonds did start rising immediately following the news, hitting their highest level in nearly three weeks at 13.6%.

The amount borrowed by banks at the LTRO "was pretty much in line with expectations," says Tom Kendall, precious metals analyst at Credit Suisse.

"Neither gold nor [the] Euro...have done very much on the back of it after an initial reaction, as it's [already] in the price."

In London meantime, the International Swaps and Derivatives Association agreed Tuesday to adjudicate on whether or not the ongoing restructuring of privately-held Greek debt constitutes a credit event – and thus whether it should trigger payments on credit default swaps. 

ISDA's Determinations Committee will meet tomorrow. If it agrees a credit event has occurred, it could trigger $3.2 billion of CDS payments, the Wall Street Journal reports. 

Ireland's government announced Tuesday that it will hold a referendum on the so-called fiscal compact agreed last December by European Union members – with the exception of Britain and the Czech Republic.

Irish prime minister Enda Kenny is expected to sign the treaty when European leaders meet later this week, before trying to persuade Irish voters to approve it. Even if Ireland votes 'No', however, the treaty could still be adopted as it only needs the approval of 12 countries.

Here in the UK, seasonally adjusted M4 – the broadest measure of UK money supply – rose 1.6% in January, though the year-on-year change was a fall of 1.8%. M4 excluding intermediate 'other financial corporations' – which the bank uses to gauge the effectiveness of its quantitative easing program – saw a 1.9% s.a. monthly gain, and a 2.9% gain year-on-year.

UK mortgage approvals meantime rose to their highest level since December 2009 last month.
"It is evident that mortgage approvals are currently being lifted by first-time buyers rushing to complete before the stamp duty concession ends in March," says Howard Archer, economist at consultancy HIS Global Insight in London.

 "Even so, mortgage approvals remain low compared to long-term norms."

India's economy grew at an annual rate of 6.1% in the last three months of 2011 – the slowest rate since the fourth quarter of 2008 – according to official data published Wednesday.

"India's economy was battered from all angles through the second half of 2011," says Glenn Levine, economist at Moody's Analytics, an arm of the ratings agency.

"[It was hit by] rising interest rates, falling stock prices, a plunging Rupee and weaker global demand."

India has long been the world's biggest gold consumer. In Q4, however, its gold bullion consumption was less than that of China – 173 tonnes compared to 191 tonnes, according to the latest World Gold Council data.

Sanction-hit Iran meantime will accept gold bullion as well as Dollars as payment from trading partners, the country's official Islamic Republic News Agency reports.

"This is a confirmation of gold's status as a store of value, a universal currency," says Michael Cuggino, president and portfolio manager  at San Francisco-based asset managers Permanent Portfolio, which manages around $15 billion in assets.

Earlier this month, traders reported that Iran was paying for wheat with gold.

By Ben Traynor
BullionVault.com

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

Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK's longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics.(c) BullionVault 2012

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.


Post Comment

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

6 Critical Money Making Rules