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
Seven Key Words That Explain "Stupidly High" Bond Market Prices - 23rd Aug 19
Is the Fed Too Late Prevent A US Housing Bear Market? - 23rd Aug 19
Manchester Airport FREE Drop Off Area Service at JetParks 1 - Video - 23rd Aug 19
Gold Price Trend Validation - 22nd Aug 19
Economist Lays Out the Next Step to Wonderland for the Fed - 22nd Aug 19
GCSE Exam Results Day Shock! How to Get 9 A*'s Grade 9's in England and Maths - 22nd Aug 19
KEY WEEK FOR US MARKETS, GOLD, AND OIL - Audio Analysis - 22nd Aug 19
USD/JPY, USD/CHF, GBP/USD Currency Pairs to Watch Prior to FOMC Minutes and Jackson Hole - 22nd Aug 19
Fed Too Late To Prevent US Real Estate Market Crash? - 22nd Aug 19
Retail Sector Isn’t Dead. It’s Growing and Pays 6%+ Dividends - 22nd Aug 19
FREE Access EWI's Financial Market Forecasting Service - 22nd Aug 19
Benefits of Acrobits Softphone - 22nd Aug 19
How to Protect Your Site from Bots & Spam? - 21st Aug 19
Fed Too Late To Prevent A US Housing Market Crash? - 21st Aug 19
Gold and the Cracks in the U.S., Japan and Germany’s Economic Data - 21st Aug 19
The Gold Rush of 2019 - 21st Aug 19
How to Play Interest Rates in US Real Estate - 21st Aug 19
Stocks Likely to Breakout Instead of Gold - 21st Aug 19
Top 6 Tips to Attract Followers On SoundCloud - 21st Aug 19
WAYS TO SECURE YOUR FINANCIAL FUTURE - 21st Aug 19
Holiday Nightmares - Your Caravan is Missing! - 21st Aug 19
UK House Building and House Prices Trend Forecast - 20th Aug 19
The Next Stock Market Breakdown And The Setup - 20th Aug 19
5 Ways to Save by Using a Mortgage Broker - 20th Aug 19
Is This Time Different? Predictive Power of the Yield Curve and Gold - 19th Aug 19
New Dawn for the iGaming Industry in the United States - 19th Aug 19
Gold Set to Correct but Internals Remain Bullish - 19th Aug 19
Stock Market Correction Continues - 19th Aug 19
The Number One Gold Stock Of 2019 - 19th Aug 19
The State of the Financial Union - 18th Aug 19
The Nuts and Bolts: Yield Inversion Says Recession is Coming But it May take 24 months - 18th Aug 19
Markets August 19 Turn Date is Tomorrow – Are You Ready? - 18th Aug 19
JOHNSON AND JOHNSON - JNJ for Life Extension Pharma Stocks Investing - 17th Aug 19
Negative Bond Market Yields Tell A Story Of Shifting Economic Stock Market Leadership - 17th Aug 19
Is Stock Market About to Crash? Three Charts That Suggest It’s Possible - 17th Aug 19
It’s Time For Colombia To Dump The Peso - 17th Aug 19
Gold & Silver Stand Strong amid Stock Volatility & Falling Rates - 16th Aug 19
Gold Mining Stocks Q2’19 Fundamentals - 16th Aug 19
Silver, Transports, and Dow Jones Index At Targets – What Direct Next? - 16th Aug 19
When the US Bond Market Bubble Blows Up! - 16th Aug 19
Dark days are closing in on Apple - 16th Aug 19
Precious Metals Gone Wild! Reaching Initial Targets – Now What’s Next - 16th Aug 19
US Government Is Beholden To The Fed; And Vice-Versa - 15th Aug 19
GBP vs USD Forex Pair Swings Into Focus Amid Brexit Chaos - 15th Aug 19
US Negative Interest Rates Go Mainstream - With Some Glaring Omissions - 15th Aug 19
GOLD BULL RUN TREND ANALYSIS - 15th Aug 19
US Stock Market Could Fall 12% to 25% - 15th Aug 19
A Level Exam Results School Live Reaction Shock 2019! - 15th Aug 19
It's Time to Get Serious about Silver - 15th Aug 19
The EagleFX Beginners Guide – Financial Markets - 15th Aug 19

Market Oracle FREE Newsletter

The No 1 Gold Stock for 2019

Gold Gains on US Stagflationary Economic Slowdown

Commodities / Gold & Silver Jul 31, 2008 - 07:56 AM GMT

By: Adrian_Ash

Commodities SPOT GOLD PRICES added to an overnight bounce at the New York opening on Thursday, rising above $915 per ounce on news of sharply higher US inflation and a slowing economy.

Gold had earlier recorded an AM Fix here in London of $912 per ounce – more than 2.1% above yesterday's five-week low – as crude oil slipped and the US Dollar held steady on the forex market ahead of today's data.


World stocks markets were also subdued, adding just 0.4% on average after a run of strong gains saw them reverse mid-July's near 4% losses.

On a monthly basis, the Morning Gold Fix in London averaged $941.53 per ounce in July, its second-highest price ever and almost 6% above June's average Gold Price .

"There's a very real chance Gold could trade above $1,000 an ounce by year-end," said Mark Bristow, CEO of African gold miner Randgold Resources in a phone interview with Thomson-Reuters today.

Reporting a 196% jump in second-quarter profits from the disastrous Q2 of 2007, Bristow said that a new record-high in the Gold Price would then look likely.

Also reporting results today, AngloGold Ashanti – the world's third-largest gold miner – announced a smaller loss for the second quarter, along with a dividend of 50¢ per share.

AngloGold mined 1.25 million ounces of gold between April and June, attributing the growth to better power supplies in South Africa . But it also bought back some 2.71 million ounces previously sold forward on its Gold Hedge Book .

Total cash costs rose by 30% from the second-quarter of last year to reach $434 an ounce.

Anglogold's Navachab Mine in Namibia now faces "an imminent blackout" says the local Informanté news site today, thanks to national power cuts threatened by a failed generating unit at the Koeberg Nuclear Station in neighboring South Africa.

"What you have to take a view on when you buy [gold mining] equities is management, operational and political risk," as Randgold chief Bristow said to MiningWeekly this spring.

"Equity's got a lot more leverage, but it is perhaps riskier."

Global gold-mining output slipped 5% in the first quarter of 2008 according to the latest data from GFMS, the London consultancy, on behalf of the World Gold Council (WGC).

Today in Hong Kong , the WGC launched the highly popular SPDR exchange-traded gold fund ( Gold ETF ) onto the local HKEx stock market.

"We have witnessed a significant increase in demand for Gold from Hong Kong investors," said CEO James Burton, "with demand for gold at the retail level more than doubling in 2007."

Meantime in Hanoi , Vietnam today, a raft of results from local Gold Dealers also showed strong growth. The Phu Nhuan Jewelry Co. saw turnover rise by 40% during the first-half of 2008.

Commercial bank Viet A attributed 45% of its total profit to Gold Trading according to the DTCK newswire.

Western banking groups, in contrast, continued to report poor second-quarter results today, with Germany 's Deutsche Bank announcing a fall of 64% in net profits from this time last year, led by a write-down in asset values worth €2.3 billion ($3.5bn).

"The second quarter of 2008 proved to be another very challenging quarter for the banking industry," said Josef Ackermann, Deutsche's CEO.

Last October, he forecast "substantial opportunities in investment banking after [summer 2007's] period of correction." ( Remember when Subprime Was Like, So Over ...? )

Back on the economic front today, the latest US gross-domestic product figures showed the economy growing by 1.9% annualized in the second quarter, down from 2.0% growth at the start of '08.

The GDP price deflator, meantime – a measure of cost-price inflation – jumped from 3.6% to 4.2% year-on-year.

Here in the UK this morning, the country's second-largest mortgage lender, Nationwide, reported a record drop in average house prices, down 1.5% over the last month alone.

The Eurozone's latest Consumer Price Index said annual inflation held at a 16-year high of 4.1% this month. Unemployment in the 15-member currency zone rose to 7.3%.

Friday brings Average Earnings data plus the latest US unemployment statistics.

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

6 Critical Money Making Rules