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 Headed for Weekly Gain Despite Dollar Strength

Commodities / Gold and Silver 2012 Nov 09, 2012 - 11:23 AM GMT

By: Ben_Traynor

Commodities

Best Financial Markets Analysis ArticleSPOT PRICES in the wholesale gold bullion market traded above $1730 an ounce Friday morning in London, having earlier touched a two-week high, while stocks fell and the Dollar and US Treasury bonds gained, with analysts suggesting weak growth and monetary policy are likely to persist.


Silver bullion traded close to $32.30 an ounce for most of this morning, 4.3% up on the week, while oil and copper prices ticked lower.

"Precious metals continue to push higher, with the rest of the complex being led by gold," says Marc Ground, commodities strategist at Standard Bank.

"In spite of Dollar strength, the market appears to continue to take comfort from Obama's re-election and the implied support this gives to continued monetary accommodation from the Fed."

Heading into the weekend, gold bullion looks set to record its first weekly gain since the start of October, having risen more than 3% since the start of the week.

"Renewed inflows into gold ETFs are responsible for the increase in price," says a note from Commerzbank, "having totaled 10.5 tonnes in the past three days alone."

Gold's 1.7% jump on Tuesday could have been caused by a gold purchase made by the Soros Fund, Standard Bank's Yuichi Ikemizu writes in his daily 'Bruce Report' today, citing a rumor circulating among New York traders.

Gold traders are at their most bullish since August 24, according to newswire Bloomberg, which reports that 25 of 33 analysts polled say they expect gold bullion to rise next week. Friday August 24 saw the first of five consecutive weekly gains for spot gold.

Here in Europe, the European Central Bank is "by and large, done" with assisting Greece, ECB president Mario Draghi told a press conference Thursday.

"On Greece, we certainly cannot do monetary financing," Draghi said, though he added that the ECB did agree a part of Greek debt restructuring back in February that it will forego profits on holdings of Greek debt bought under its Securities Markets Programme.

"What happens is that these profits naturally accrue to the central banks that are members of the Eurosystem...[who may then] transfer these profits to the governments and then it is up to the governments to decide whether they want to re-use these profits for Greece. And the governments actually committed themselves to do so at that time."

"Markets continue to trade on a weak note given lingering [US] fiscal cliff concerns and worries about whether Greece will get the funding it needs to meet debt payments" says Nick Verdi, Singapore-based currency strategist at Barclays.

Draghi also answered a series of questions on whether he would like to see Spain request a bailout by saying it is up to the Spanish government and not the ECB. The ECB's sovereign bond buying program, Outright Monetary Transactions, requires a government to have agreed to an adjustment program before the ECB will buy its bonds in the secondary market.

Benchmark yields on 10-Year Spanish government bonds touch a one-month high this morning, a day after Spain auctioned longer-term bonds for the first time in 18 months, according to newswire Reuters.

"The five-year sale was awful," said one trader, citing a wide discrepancy between the highest yield accepted for the bond and the average yield.

Spain has over €100 billion of debt due to mature next year.

The ECB voted to leave its key interest rate on hold at 0.75% Thursday.

"We have penciled in an interest-rate cut in December," says Howard Archer, economist at research firm IHS Global Insight.

The Euro fell to a one-month low against the Dollar Friday, while Euro gold prices traded within 2% of last month's all-time high.

Elsewhere in Europe, German inflation held steady at 2% last month, according to figures published this morning.

Over in China, industrial production grew by 9.6% in the year to October, official figures published Friday show, up on the previous month and a stronger acceleration that most analysts forecast.

Retails sales growth was also stronger-than-expect last month at 14.5% year-on-year – up from 14.2% in September.

"The domestic economy is evolving in a good direction," China's central bank governor Zhou Xiaochuan said Thursday, ahead of the release of the above data.

"The key question for investors," says Bank of America Merrill Lynch economist Lu Ting, "is whether China's economic growth has truly bottomed out. Based on October data… the answer is firmly yes."

China's consumer price index meantime shows inflation fell to 1.7% last month, down from 1.9% a month earlier.

"The October CPI confirms that inflation is currently not a main concern for the government," says Nomura analyst Zhang Zhiwei.

"Policy easing will likely continue in Q4 to support a growth recovery."

Chinese gold bullion demand is expected to hit 860 tonnes this year, a 1% increase on 2011, according to Philip Klapwijk, global head of metals analytics at consultancy Thomson Reuters GFMS.

"China will overtake India [this year]," Klapwijk told the online Reuters Global Gold Forum Thursday, "both in overall demand terms and as the world's largest jewelry market."

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