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
Trump Stocks and Crypto Mania 2025 Incoming as Bitcoin Breaks Above $100k - 8th Dec 24
Gold Price Multiple Confirmations - Are You Ready? - 8th Dec 24
Gold Price Monster Upleg Lives - 8th Dec 24
Stock & Crypto Markets Going into December 2024 - 2nd Dec 24
US Presidential Election Year Stock Market Seasonal Trend - 29th Nov 24
Who controls the past controls the future: who controls the present controls the past - 29th Nov 24
Gold After Trump Wins - 29th Nov 24
The AI Stocks, Housing, Inflation and Bitcoin Crypto Mega-trends - 27th Nov 24
Gold Price Ahead of the Thanksgiving Weekend - 27th Nov 24
Bitcoin Gravy Train Trend Forecast to June 2025 - 24th Nov 24
Stocks, Bitcoin and Crypto Markets Breaking Bad on Donald Trump Pump - 21st Nov 24
Gold Price To Re-Test $2,700 - 21st Nov 24
Stock Market Sentiment Speaks: This Is My Strong Warning To You - 21st Nov 24
Financial Crisis 2025 - This is Going to Shock People! - 21st Nov 24
Dubai Deluge - AI Tech Stocks Earnings Correction Opportunities - 18th Nov 24
Why President Trump Has NO Real Power - Deep State Military Industrial Complex - 8th Nov 24
Social Grant Increases and Serge Belamant Amid South Africa's New Political Landscape - 8th Nov 24
Is Forex Worth It? - 8th Nov 24
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Asian Gold Demand "Decent", Premiums "Steady" as US Futures Exchange Cuts Margin

Commodities / Gold and Silver 2012 May 25, 2012 - 07:18 AM GMT

By: Adrian_Ash

Commodities

Best Financial Markets Analysis ArticleLONDON QUOTES for wholesale gold bars held above $1560 per ounce Friday morning, cutting the week's losses to 1.9% as European stock markets reversed their earlier rally and the Euro fell to a new two-year low.

Oil rose, but commodities headed for their fourth weekly loss in succession as Asian stock markets crept 0.1% higher from Thursday's near 5-month low.


Silver bullion rose above $28.30 per ounce, recovering two-thirds of this week's 5.5% drop to Wednesday's low.

"[Mid-week] was bloodshed as panic and fear continue to dominate the market," said one Singapore dealer.

But "while Indian [physical] demand has been lower than normal, overall we continue to see decent buying interest from the rest of Asia," says today's note from Standard Bank in London, "especially South East Asia."

Premiums on gold bars traded in Tokyo rose Friday to $1.50 per ounce above the world's benchmark price – set by quotes for London delivery – "as investors turned from sellers to buyers," says Reuters.

Gold bar premiums in Hong Kong and Singapore "were steady from last week," says the newswire.

US gold futures in contrast – where speculators have cut their bullish exposure by two-thirds from August 2011's record – will cost less in margin downpayments starting next Wednesday, the CME trading exchange said yesterday.

The second cut to margin requirements since February, the CME's move cuts the initial margin required to open a 100-ounce gold future to $9,113 – some 5.8% of the June contract's current value, and down by one-fifth from the record margin requirement reached last summer.

"Margin reductions tend to have a less immediate impact on prices than margin hikes," says ANZ Bank's commodity desk in a note.

"Nevertheless, the reduction is likely to be mildly supportive going forward."

In exchange-traded funds, Thursday saw the $68 billion SPDR Gold Trust add 2 tonnes to the bullion holdings needed to back its shares.

Some 3.8% below its record holding of June 2010, the SPDR remained 12 tonnes lighter for the week at 1270 tonnes.

"Gold's direction seems to be driven more by the level of market risk aversion and the Euro currently," says Anne-Laure Tremblay at BNP Paribas, quoted by Reuters.

"Market sentiment on gold is fragile at the moment. A shift to a more accommodative monetary policy stance may be needed to sustain a gold bull rally."

The European Central Bank will next meet and set interest rates for the Eurozone's 330-million citizens on 6th June.

French government bond yields fell to new record lows as investors pushed prices higher, with 10-year debt offering an annual return of 2.42%.

"The current German rate is really low and yield seekers are looking for other opportunities," reckons bond trader Hajime Nagata at Diam Co., which runs $124 billion in asset and is part of Japan's second-biggest life insurance group, Dai-ichi.

Noting that the new French government of Socialist leader Francoise Hollande is raising the tax-free ceiling for domestic savings, "The assumption is that this money will be used to purchase French government bonds," Nagata is quoted by Bloomberg.

German 10-year Bund yields today held flat at 1.39% per year. Comparable US debt yields edged down to 1.76%.

The falling Euro meantime pushed the price of wholesale gold bars for Eurozone buyers back above €40,000 per kilo, unchanged for the week after an overnight dip.

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 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.


© 2005-2022 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