Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Gold Price Slowly Going Nowhere - 20th Oct 21
Shocking Numbers Show Government Crowding Out Real Economy - 20th Oct 21
Crude Oil Is in the Fast Lane, But Where Is It Going? - 20th Oct 21
3 Tech Stocks That Could Change The World - 20th Oct 21
Best AI Tech Stocks ETF and Investment Trusts - 19th Oct 21
Gold Mining Stocks: Will Investors Dump the Laggards? - 19th Oct 21
The Most Exciting Medical Breakthrough Of The Decade? - 19th Oct 21
Prices Rising as New Dangers Point to Hard Assets - 19th Oct 21
It’s not just Copper; GYX indicated cyclical the whole time - 19th Oct 21
Chinese Tech Stocks CCP Paranoia, VIES - Variable Interest Entities - 19th Oct 21
Inflation Peaked Again, Right? - 19th Oct 21
Gold Stocks Bouncing Hard - 19th Oct 21
Stock Market New Intermediate Bottom Forming? - 19th Oct 21
Beware, Gold Bulls — That’s the Beginning of the End - 18th Oct 21
Gold Price Flag Suggests A Big Rally May Start Soon - 18th Oct 21
Inflation Or Deflation – End Result Is Still Depression - 18th Oct 21
A.I. Breakthrough Could Disrupt the $11 Trillion Medical Sector - 18th Oct 21
US Economy and Stock Market Addicted to Deficit Spending - 17th Oct 21
The Gold Price And Inflation - 17th Oct 21
Went Long the Crude Oil? Beware of the Headwinds Ahead… - 17th Oct 21
Watch These Next-gen Cloud Computing Stocks - 17th Oct 21
Overclockers UK Custom Built PC 1 YEAR Use Review Verdict - Does it Still Work? - 16th Oct 21
Altonville Mine Tours Maze at Alton Towers Scarefest 2021 - 16th Oct 21
How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
The Only way to Crush Inflation (not stocks) - 14th Oct 21
Why "Losses Are the Norm" in the Stock Market - 14th Oct 21
Sub Species Castle Maze at Alton Towers Scarefest 2021 - 14th Oct 21
Which Wallet is Best for Storing NFTs? - 14th Oct 21
Ailing UK Pound Has Global Effects - 14th Oct 21
How to Get 6 Years Life Out of Your Overclocked PC System, Optimum GPU, CPU and MB Performance - 13th Oct 21
The Demand Shock of 2022 - 12th Oct 21
4 Reasons Why NFTs Could Be The Future - 12th Oct 21
Crimex Silver: Murder Most Foul - 12th Oct 21
Bitcoin Rockets In Preparation For Liftoff To $100,000 - 12th Oct 21
INTEL Tech Stock to the MOON! INTC 2000 vs 2021 Market Bubble WARNING - 11th Oct 21
AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
Stock Market Wall of Worry Meets NFPs - 11th Oct 21
Stock Market Intermediate Correction Continues - 11th Oct 21
China / US Stock Markets Divergence - 10th Oct 21
Can US Save Taiwan From China? Taiwan Strait Naval Battle - PLA vs 7th Fleet War Game Simulation - 10th Oct 21
Gold Price Outlook: The Inflation Chasm Between Europe and the US - 10th Oct 21
US Real Estate ETFs React To Rising Housing Market Mortgage Interest Rates - 10th Oct 21
US China War over Taiwan Simulation 2021, Invasion Forecast - Who Will Win? - 9th Oct 21
When Will the Fed Taper? - 9th Oct 21
Dancing with Ghouls and Ghosts at Alton Towers Scarefest 2021 - 9th Oct 21
Stock Market FOMO Going into Crash Season - 8th Oct 21
Scan Computers - Custom Build PC 6 Months Later, Reliability, Issues, Quality of Tech Support Review - 8th Oct 21
Gold and Silver: Your Financial Main Battle Tanks - 8th Oct 21
How to handle the “Twin Crises” Evergrande and Debt Ceiling Threatening Stocks - 8th Oct 21
Why a Peak in US Home Prices May Be Approaching - 8th Oct 21
Alton Towers Scarefest is BACK! Post Pandemic Frights Begin, What it's Like to Enter Scarefest 2021 - 8th Oct 21
AJ Bell vs II Interactive Investor - Which Platform is Best for Buying US FAANG Stocks UK Investing - 7th Oct 21
Gold: Evergrande Investors' Savior - 7th Oct 21
Here's What Really Sets Interest Rates (Not Central Banks) - 7th Oct 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold Bounces Back after Spanish Ratings Cut

Commodities / Gold and Silver 2012 Oct 11, 2012 - 12:00 PM GMT

By: Ben_Traynor

Commodities

Best Financial Markets Analysis ArticleSPOT MARKET gold bullion prices climbed back above $1770 an ounce during Thursday morning's London trading – still a few Dollars below where it started the week – as the Euro also recovered ground following falls overnight after Spain had its credit rating cut.

Stock markets edged higher this morning, as did most industrial commodities, while US Treasury bonds fell and German bund prices gained.


Silver bullion climbed as high as $34.33 an ounce, also slightly down on the week.

"We are watching support [for silver] at $33.37," says bullion bank Scotia Mocatta's latest technical analysis.

"A breach through that level…could indicate a double top in silver, which would target the low $31 level."

The volume of gold bullion backing the world's largest gold ETF, SPDR Gold Shares (GLD), held steady yesterday at an all-time high of 1340.5 tonnes.

Earlier this week, holdings of gold by all ETFs tracked by newswire Reuters hit a new record at 2333.7 tonnes.

"The continuously rising ETF holdings show that investors are still confident in gold in the longer term," says Jinrui Futures analyst Chen Min in China, adding that last month's US Federal Reserve decision to extend quantitative easing indefinitely "has put a floor under gold".

The European Central Bank also announced open-ended bond buying last month, while the Bank of Japan extended its long running QE program.

"Additional monetary policy easing in the United States and other countries is no longer fresh news," points out HSBC commodities analyst James Steel.

"We do not anticipate further significant buying of gold based on monetary policy accommodation alone."

"We have seen easing policies come from both Europe and the US in recent weeks," adds a note from Ed Meir, analyst at commodities brokerage INTL FCStone, "but we have yet to see it coming from China, which in some ways, is the last 'hold-out' and one that could provide the gold market another lift in the event that authorities signal more monetary relaxation."

"[Chinese policymakers] don't seem to be rushing to pump growth up again," reckons Paul Sheard, chief global economist at ratings agency Standard & Poor's.

"I think they're somewhat comfortable in the 7-8% zone [for GDP growth]. But, were the Chinese economy to show signs of dipping below this level, then I do think you would see the policymakers galvanized into action."

"China is no longer in the mood to provide a massive stimulus [as it did in 2008]," agrees HSBC group chief economist Stephen King.

"China's exports have succumbed to the downswing in world trade. Once the global economy's savior, China has become its latest scalp."

Gold bullion imports into China from Hong Kong, the primary conduit for Chinese gold imports, fell to 53.5 tonnes in August – 29% down on a month earlier and a 26% year-on-year drop – figures published by the Hong Kong Census and Statistics Department show.

"Increased prices have clearly left their mark on gold demand," says today's Commodities Daily note from Commerzbank.

"A further reason for the lower net import figures recently is likely to have been the higher level of domestic gold production, which in August totalled 41.4 tonnes according to the Chinese government."

Here in Europe, Spain had its credit rating cut to one notch above junk last night by S&P, which downgraded Spain from BBB+ to BBB- while maintaining a negative outlook.

"The negative outlook on the long-term rating reflects our view of the significant risks to Spain’s economic growth and budgetary performance," said an S&P statement.

"[There is a] lack of a clear direction in Eurozone policy…[and] the deepening economic recession is limiting the Spanish government's policy options."

Countries like Spain should be given more time to reduce their government deficits, International Monetary Fund chief Christine Lagarde said Thursday.

"That is what I have advocated for Portugal, this is what I have advocated for Spain, and this is what we are advocating for Greece," Lagarde told reporters in Tokyo, where the IMF and World Bank are holding their annual meetings.

Lagarde added that Greece should be granted the additional two years prime minister Antonis Samaras is seeking to implement austerity measures.

Earlier this week, the IMF cut its growth forecast for the Euro area and projected a sharper 2013 contraction for Spain than previously forecast three months ago.

Gold mining workers on strike in South Africa have rejected the latest wage offer from employers, the national Union of Mineworkers has said.

"This was a final offer from the companies," said NUM spokesman Lesiba Seshoka.

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