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
Investing in the METAVERSE Stocks Universe - 8th Dec 21
Stock Market Sentiment Speaks: I Expect 15-20% Returns For 2022 - 8th Dec 21
US Dollar Still Has the Green Light - 8th Dec 21
Stock Market Topping Process Roadmap - 8th Dec 21
The Lithium Breakthrough That Could Transform The Mining Industry - 8th Dec 21
VR and Gaming Becomes the Metaverse - 7th Dec 21
How to Read Your Smart Meter - Economy 7, Day and Night Rate Readings SMETS2 EDF - 7th Dec 21
For Profit or for Loss: 4 Tips for Selling ASX Shares - 7th Dec 21
INTEL Bargain Teck Stocks Trading at 15.5% Discount Sale - 7th Dec 21
US Bonds Yield Curve is not currently an inflationist’s friend - 7th Dec 21
Omicron COVID Variant-Possible Strong Stock Market INDU & TRAN Rally - 7th Dec 21
The New Tech That Could Take Tesla To $2 Trillion - 7th Dec 21
S&P 500 – Is a 5% Correction Enough? - 6th Dec 21
Global Stock Markets It’s Do-Or-Die Time - 6th Dec 21
Hawks Triumph, Doves Lose, Gold Bulls Cry! - 6th Dec 21
How Stock Investors Can Cash in on President Biden’s new Climate Plan - 6th Dec 21
The Lithium Tech That Could Send The EV Boom Into Overdrive - 6th Dec 21
How Stagflation Effects Stocks - 5th Dec 21
Bitcoin FLASH CRASH! Cryptos Blood Bath as Exchanges Run Stops, An Early Christmas Present for Some? - 5th Dec 21
TESCO Pre Omicron Panic Christmas Decorations Festive Shop 2021 - 5th Dec 21
Dow Stock Market Trend Forecast Into Mid 2022 - 4th Dec 21
INVESTING LESSON - Give your Portfolio Some Breathing Space - 4th Dec 21
Don’t Get Yourself Into a Bull Trap With Gold - 4th Dec 21
GOLD HAS LOTS OF POTENTIAL DOWNSIDE - 4th Dec 21
4 Tips To Help You Take Better Care Of Your Personal Finances- 4th Dec 21
What Is A Golden Cross Pattern In Trading? - 4th Dec 21
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - Part 2 - 3rd Dec 21
Stock Market Major Turning Point Taking Place - 3rd Dec 21
The Masters of the Universe and Gold - 3rd Dec 21
This simple Stock Market mindset shift could help you make millions - 3rd Dec 21
Will the Glasgow Summit (COP26) Affect Energy Prices? - 3rd Dec 21
Peloton 35% CRASH a Lesson of What Happens When One Over Pays for a Loss Making Growth Stock - 1st Dec 21
Stock Market Sentiment Speaks: I Fear For Retirees For The Next 20 Years - 1st Dec 21 t
Will the Anointed Finanical Experts Get It Wrong Again? - 1st Dec 21
Main Differences Between the UK and Canadian Gaming Markets - 1st Dec 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold Slips as US Dollar Bounces Despite US Economic Slowdown

Commodities / Gold & Silver Mar 27, 2008 - 01:06 PM GMT

By: Adrian_Ash

Commodities THE PRICE OF GOLD slipped 1.1% early in London on Thursday, giving back yesterday's bounce to fall below $943 per ounce as world equity markets ticked higher and crude oil reached a one-week high after a militia attack on Iraq's main oil terminal.

"The Gold Market at the moment continues to drift sideways," says Mitsui in Sydney . "With quarter-end approaching, the metal's momentum to the upside could well be capped in the immediate term."


For European investors wanting to Buy Gold today the price slid beneath €600 per ounce, even as the single currency dropped 0.6% against the Dollar.

The US Dollar also rose against the Japanese Yen, regaining the ¥100 mark despite new data that confirmed the world's largest economy grew by only 0.6% in the last three months of 2007 – down from 4.9% growth in the third quarter.

Prices paid by US residents rose sharply, however, increasing 3.7% year-on-year in Dec. Inflation over the late summer months was only 1.8% annualized.

An auction of $18 billion in five-year US Treasury bonds today will offer yields of barely 2.55% per year, "close to the lowest levels since 2003," according to Bloomberg.

In contrast to the Federal Reserve's aggressive rate-cutting, "the European Central Bank is trying, more than anything else, to prevent inflationary expectations," said ECB president Jean-Claude Trichet on German television last night.

The central bank of Brazil today raised its inflation forecast to 4.6% for 2008, while Taiwanese authorities raised their key lending rate to a near seven-year high.

Back in the metals market, the Gold Price in British Pounds today dropped below £470 as the Pound fell back from the morning's seven-session high of $2.0190.

All base metals rose except zinc at the London Metal Exchange, while Comex silver contracts dropped 0.6% ahead of the New York open as silver continued to out-strip and magnify the volatility in Gold Bullion prices.

"With the Dollar up, it shouldn't come as a surprise that Gold Prices are falling," reckons Peter Fertig at Dresdner Kleinwort's office in Hainburg , Germany .

Reuters reports strong Gold Buying by jewelers and investors in Indonesia , Thailand , Vietnam and India , where the spring wedding season is fast approaching.

"We heard Thailand was running out of gold bars this week," one dealer in Singapore told the newswire overnight, "because many refiners were closed over the Easter holiday, while demand was good.

"I would think physical demand is offering support for gold," he added, pegging $940 as the metal's lower limit for now.

Wall Street stock futures pointed higher ahead of Thursday's open, but Oracle – the world's third largest software firm – threatened to drag the Nasdaq lower after dropping 8.3% overnight on below-forecast earnings.

Crude oil meantime rose to a one-week high above $106 per barrel on news of a pipeline explosion near Basra in southern Iraq .

The country's second city has now been under attack from militia loyal to Moqtada al-Sadr, the Shi'ite cleric. Basra ships most of the 2.32 million barrels of oil Iraq pumps each day.

Pipeline disruptions continued to affect the world's major capital markets early Thursday as well, with the European Central Bank offering extra short-term funds before the end of March. Both the Bank of England and Swiss National Bank worked to ease short-term lending rates in the open market, according to a Reuters report.

"Normally the banks lend to each other," noted Gary Shilling of the eponymous finance consultancy to CNBC overnight, "but what [the Fed] are finding is the banks don't trust each other, so they've got to lend [directly] to the ones who need it."

Standard Fed procedure offers short-term loans to the big "money centre" banks, who are then supposed to pass these extra funds to smaller institutions. But with fear still blocking the inter-bank loans market, "the Fed are stepping in and providing the function of the banking system," says Shilling.

By Adrian Ash
BullionVault.com

Gold price chart, no delay | Free Report: 5 Myths of the Gold Market
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 2008

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.

Adrian Ash Archive

© 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