Best of the Week
Most Popular
1.RED ALERT: Paris Terror Attacks - What to Expect Next - STRATFOR
2.Paris Terror Attacks, Death Pangs of a Dying Religion, and Impact on BrExit EU Referendum - Nadeem_Walayat
3.Paris Terror Attacks, Islamic State Attempting to Spark Civil War in France - Nadeem_Walayat
4.Three Shocking Charts That Prove Gold Price Rally Is Coming - Sean Brodrick
5.Stock Market Nifty-Fifty Becomes Fab-Five; Return of the 'Four Horseman' - Mike_Shedlock
6.Africa Population Explosion - Why Europe's Migrant Crisis is Going to Get A Lot Worse - Video - Nadeem_Walayat
7.Gold Mining Stocks May Be The Buy Of The Century - Jeff_Berwick
8.Grandmaster Putin Beats Uncle Sam at His Own Game - Mike_Whitney
9.BRICS? No, CRISIS - Raymond_Matison
10.UK Housing Market Affordability, House Prices Momentum and Trend Forecast - Nadeem_Walayat
Last 5 days
Stock Market Top Valuations, at a Critical Juncture - 27th Nov 15
The Top Shopping Opportunity on Black Friday - 27th Nov 15
Economics Is About Scarcity, Property, and Relationships - 27th Nov 15
UK Immigration Crisis Hits New Extreme of 336k Net Migration, up 32% on 2014 - 27th Nov 15
Vauxhall Zafira B Fire Danger Recall - What to Do Video - 26th Nov 15
Triggers In US Dollar Collapse - 26th Nov 15
Apple Stock is a 10-Year Short - Bear Market Environment - 26th Nov 15
U.S. Federal Reserve Rate Hike - 26th Nov 15
George Osborne's War on Buy to Let Sector Trending Towards Doomsday - 26th Nov 15
Will Turkey Drag NATO into War With Russia in Syria? - 25th Nov 15
George Osborne’s Autumn Statement and Spending Review Full Text - 25th Nov 15
Will Fresh QE From ECB Boost Gold? - 25th Nov 15
Sheffield, Yorkshire and Humberside House Prices Forecast 2016-2018 - 25th Nov 15
Investors Watch Out For The Auto Industry… - 24th Nov 15
BEA Revises 3rd Quarter 2015 US GDP Economic Growth Upward to 2.07% - 24th Nov 15
Stock Market Supports Are Being Broken - 24th Nov 15
Is Gold Price on the Verge of a Breakout? - 24th Nov 15
Fed’s Tarullo: U.S. Interest Rates Liftoff Should Wait for Signs of Inflation - 24th Nov 15
Silver Price, COT, US Dollar Updates and More - 24th Nov 15
UK Regional House Prices Analysis - Video - 23rd Nov 15
Crude Oil Swinging For The Fences - A 20 to 1 Option Play - 23rd Nov 15
US Dollar, CRB, Oil, Gas, Copper and Gold - The Chartology of Deflation - 23rd Nov 15
UK Regional House Prices, Cheapest and Most Expensive Property Markets - 23rd Nov 15
Stock Market Rally Losing Momentum? - 23rd Nov 15
Will Gold Price Drop Below $1000 Soon? - 23rd Nov 15
Gold and Silver Sector Big Green Light and Low Risk Entry Setup... - 23rd Nov 15
Limits to Economic Growth - Challenge and Choices - 22nd Nov 15
Long Dollar Trade and Current Copper Price Below Cost of Production - 22nd Nov 15
UK Housing Market House Prices Affordability Crisis - Video - 21st Nov 15
The Fed Has Set the Stage for a Stock Market Crash - 21st Nov 15
Stock Market Primary V Wave Continues - 21st Nov 15
Gold And Silver - Value Of Knowing The Trend - 21st Nov 15
UK Footsie Bulls Set To Foot The Bill - 21st Nov 15
UK Housing Market Affordability, House Prices Momentum and Trend Forecast - 21st Nov 15
GDX Gold Miners’ Strong Q3 Results - 20th Nov 15
End of Schengen, Stock Market’s Technical Strength Grows - 20th Nov 15
Justice for All and The Curious Case of Zambia - 20th Nov 15
Paris, Sharm el-Sheikh, and the Resurrection of Old Europe - 20th Nov 15
Silver Prices and The Management of Perception - 20th Nov 15
Stock Market Nifty-Fifty Becomes Fab-Five; Return of the 'Four Horseman' - 20th Nov 15
Waiting for Goldot Again - 20th Nov 15
Michael Curran Goes Down-Market Shopping for Gold Stock Winners - 20th Nov 15
Why Isn’t This Incredibly Bearish Bond Market Development Making the News? - 19th Nov 15
SPX Appears to have Stopped its Rally - 19th Nov 15
The Great Fall Of China Started At Least 4 Years Ago - 19th Nov 15
Using Elliott Waves: As Simple As A-B-C - 19th Nov 15
Has Deflation Been Ddefeated? - 19th Nov 15
Dow Jones Stock Market Index is Not Going to Crash - 19th Nov 15

Free Instant Analysis

Free Instant Technical Analysis

Market Oracle FREE Newsletter

Reasons to Get Excited About Japanese Stocks

Gold Price Continues to Consolidate

Commodities / Gold and Silver 2012 Nov 14, 2012 - 08:31 AM GMT

By: Ben_Traynor


Best Financial Markets Analysis ArticleU.S. DOLLAR gold prices drifted lower to $1722 an ounce this morning in London, slightly down from last week's close, while stock markets also fell along with US Treasury bonds as US policymakers continue to discuss how to deal with the so-called fiscal cliff.

"Gold is consolidating last week's strong up leg from $1673 to $1739," says the latest technical analysis from bullion dealer Scotiabank.

Silver prices edged down to $32.38 an ounce, also slightly down on last week's close.

Broad commodities were little changed on the day by lunchtime in London, while on the currency markets, the Euro extended yesterday's gains against the Dollar following news that Greece has successfully raised the €5 billion it needs to cover a bond repayment this week.

Forty unions in 23 countries meantime were expected to take part in anti-austerity strikes across Europe today, according to the European Trade Union Confederation.

Police clashed with protestors in Madrid as unions in Spain and Portugal held their first ever coordinated strike, Reuters reports, bringing transport and manufacturing to a halt in many places.

Workers in Belgium, France, Greece and Italy were among those planning stoppages as part of the 'European Day of Action and Solidarity'.

In the US, President Obama plans to propose $1.6 trillion worth of tax rises on corporations and wealthy individuals over the next ten years, the Washington Post reports.

After meeting labor leaders yesterday, Obama will meet business representatives today as he continues his efforts to build support for his plans to avoid the so-called fiscal cliff of tax rises and spending cuts currently due at the start of January.

Democrats have said they would like to see tax cuts on the wealthiest 2% brought in under President Bush expire. Republicans have expressed opposition to this.

As well as letting the Bush tax cuts expire, the government will also need to impose additional taxes, according to US Treasury secretary Timothy Geithner.

"When you take a cold, hard look at the amount of resources you can raise from that top 2% of Americans through limiting deductions," Geithner said yesterday, "you will find yourself disappointed relative to the magnitude of the revenue increases that we need."

"Our short-term outlook continues to call for further gains in gold," says a note from brokerage INTL FCStone, "but we would not be surprised by a rather substantial correction once a fiscal cliff agreement is reached, particularly if the accord is more comprehensive in nature and not a patchwork job that merely kicks the can down the road."

"If we have brinkmanship, and we don't see a resolution, that could put downward pressure on gold," adds Deutsche Bank analyst Daniel Brebner.

Gold prices will "take out $2000 [an ounce]," according to Brebner's colleague Raymond Key, Deutsche bank's global head of precious metals trading, speaking in an interview he gave in Hong Kong where he was attending the annual London Bullion Market Association conference.

"We'll go higher...that's on the view that [the Federal Reserve will] continue to print money."

The minutes of the most recent Fed meeting are published later today.

The Bank of England meantime has lowered its UK growth forecast to 1% for next year, down from its previous forecast of 2%.

In its quarterly Inflation Report published this morning, the Bank said "underlying growth is likely to remain sluggish in the near term".

"The subdued recovery reflects a judgment that the global environment will remain unfavorable," the Bank's governor Mervyn King said.

"We face the rather unappealing combination of a subdued recovery with inflation remaining above target for a while."

Consumer price inflation rose to 2.7% last month, figures published Tuesday show, the 36th month in a row it has been above the Bank's 2% target.

"Inflation is likely to remain above target for the first part of the forecast period," said King this morning.

"Nevertheless, the [Monetary Policy] Committee judges that inflation is likely to fall back in the second half of next year."

The global silver bullion market is expected to remain in surplus this year, with the surplus rising to 300 million ounces, Philip Klapwijk, global head on metals analytics at consultancy Thomson Reuters GFMS said Wednesday.

"We see weaker fabrication demand on two main reasons," said Klapwijk.

"One is industrial fabrication has slowed quite considerably this year, especially in recent months, and we see weakness especially in the electronics field and photovoltaic end users."

By Ben Traynor

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.

© 2005-2015 - 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

Biggest Debt Bomb in History