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
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 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