Best of the Week
Most Popular
1. Market Decline Will Lead To Pension Collapse, USD Devaluation, And NWO - Raymond_Matison
2.Uber’s Nightmare Has Just Started - Stephen_McBride
3.Stock Market Crash Black Swan Event Set Up Sept 12th? - Brad_Gudgeon
4.GDow Stock Market Trend Forecast Update - Nadeem_Walayat
5.Gold Significant Correction Has Started - Clive_Maund
6.British Pound GBP vs Brexit Chaos Timeline - Nadeem_Walayat
7.Cameco Crash, Uranium Sector Won’t Catch a break - Richard_Mills
8.Recession 2020 Forecast : The New Risks & New Profits Of A Grand Experiment - Dan_Amerman
9.Gold When Global Insanity Prevails - Michael Ballanger
10.UK General Election Forecast 2019 - Betting Market Odds - Nadeem_Walayat
Last 7 days
UK General Election 2019 BBC Exit Poll Forecast Accuracy Analysis - 12th Dec 19
Technical Analysis Update: Tadawul All Share Index (TASI) - Saudi Arabia ETF (KSA) - 12th Dec 19
Silver Miners Pinpoint the Precious Metals’ Outlook - 12th Dec 19
How Google Has Become the Worlds Biggest Travel Company - 12th Dec 19
UK Election Seats Forecasts - Tories 326, Labour 241, SNP 40, Lib Dems 17 - 12th Dec 19
UK General Election 2019 Final Seats Per Party Forecast - 12th Dec 19
What UK CPI, RPI INFLATION Forecasts for General Election Result 2019 - 11th Dec 19
Gold ETF Holdings Surge… But Do They Actually Hold Gold? - 11th Dec 19
Gold, Silver Reversals, Lower Prices and Our Precious Profits - 11th Dec 19
Opinion Pollsters, YouGov MRP General Election 2019 Result Seats Forecast - 11th Dec 19
UK General Election Tory and Labour Marginal Seats Analysis, Implied Forecast 2019 - 11th Dec 19
UK General Election 2019 - Tory Seats Forecast Based on GDP Growth - 11th Dec 19
YouGov's MRP Poll Final Tory Seats Forecast Revised Down From 359 to 338, Possibly Lower? - 10th Dec 19
What UK Economy (Average Earnings) Predicts for General Election Results 2019 - 10th Dec 19
Labour vs Tory Manifesto's UK General Election Parliamentary Seats Forecast 2019 - 10th Dec 19
Lumber is about to rally and how to play it with this ETF - 10th Dec 19
Social Mood and Leaders Impact on General Election Forecast 2019 - 9th Dec 19
Long-term Potential for Gold Remains Strong! - 9th Dec 19
Stock and Financial Markets Review - 9th Dec 19
Labour / Tory Manifesto's Impact on UK General Election Seats Forecast 2019 - 9th Dec 19
Tory Seats Forecast 2019 General Election Based on UK House Prices Momentum Analysis - 9th Dec 19
Top Tory Marginal Seats at Risk of Loss to Labour and Lib Dems - Election 2019 - 9th Dec 19
UK House Prices Momentum Tory Seats Forecast General Election 2019 - 8th Dec 19
Why Labour is Set to Lose Sheffield Seats at General Election 2019 - 8th Dec 19
Gold and Silver Opportunity Here Is As Good As It Gets - 8th Dec 19
High Yield Bond and Transports Signal Gold Buy Signal - 8th Dec 19
Gold & Silver Stocks Belie CoT Caution - 8th Dec 19
Will Labour Government Spending Bankrupt Britain? UK Debt and Deficits - 7th Dec 19
Lib Dem Fake Tory Election Leaflets - Sheffield Hallam General Election 2019 - 7th Dec 19
You Should Be Buying Gold Stocks Now - 6th Dec 19
The End of Apple Has Begun - 6th Dec 19
How Much Crude Oil Do You Unknowingly Eat? - 6th Dec 19
Labour vs Tory Manifesto Voter Bribes Impact on UK General Election Forecast - 6th Dec 19
Gold Price Forecast – Has the Recovery Finished? - 6th Dec 19
Precious Metals Ratio Charts - 6th Dec 19
Climate Emergency vs Labour Tree Felling Councils Reality - Sheffield General Election 2019 - 6th Dec 19
What Fake UK Unemployment Statistics Predict for General Election Result 2019 - 6th Dec 19
What UK CPI, RPI and REAL INFLATION Predict for General Election Result 2019 - 5th Dec 19
Supply Crunch Coming as Silver Miners Scale Back - 5th Dec 19
Gold Will Not Surpass Its 1980 Peak - 5th Dec 19
UK House Prices Most Accurate Predictor of UK General Elections - 2019 - 5th Dec 19
7 Year Cycles Can Be Powerful And Gold Just Started One - 5th Dec 19
Lib Dems Winning Election Leaflets War Against Labour - Sheffield Hallam 2019 - 5th Dec 19
Do you like to venture out? Test yourself and see what we propose for you - 5th Dec 19
Great Ways To Make Money Over Time - 5th Dec 19
Calculating Your Personal Cost If Stock, Bond and House Prices Return To Average - 4th Dec 19

Market Oracle FREE Newsletter

UK General Election Forecast 2019

Gold Surges Higher as Dollar Falls vs. Stocks and Euro

Commodities / Gold & Silver 2009 Mar 13, 2009 - 08:46 AM GMT

By: Adrian_Ash

Commodities THE PRICE OF SPOT GOLD leapt in late-morning London trade on Friday, erasing nearly all of this week's 5% drop for US and UK investors, but falling straight back an hour later as New York opened for business.

World stock markets meantime rose sharply once again, closing more than 5% higher in Tokyo.


Crude oil rose towards $48 per barrel, as the US Dollar slipped against all major currencies bar the Yen, dropping to a 3-week low vs. the Euro.

"Even though we've had such good gains" in stocks, noted Cleveland Rueckert, a market analyst at Birinyi Associates in Stamford, Connecticut, to Reuters overnight, "it could just be short-covering.

"Most people in the market are short-term traders right now and you're not really seeing the accumulation of stocks."

Government bonds fell back as world equities pushed upwards early Friday, knocking the yield on 30-year German bunds sixteen basis points higher to 3.95%.

Yesterday the US Treasury sold a fresh $11 billion of its 30-year debt, receiving bids for 2.4 times the bonds on offer but sparking fears that prices would be much lower – and interest-rate yields much higher – "were it not that the Federal Reserve may become a buyer of Treasuries themselves," as one strategist put it.

Urging a return to the easy leverage and loose liquidity of the last decade, "We need to boost [economic] demand through a range of measures," says UK finance minister Alistair Darling today, writing in the Wall Street Journal ahead of April's G20 summit of industrialized nations:

"Monetary loosening, fiscal stimulus, and restoring bank lending."

This week the Bank of England began " Quantitative Easing " in a bid to boost credit supplies in the UK, creating new money to buy £2 billion of government bonds.

With one-third of UK gilts held by foreign investors, however, "The feedback from the auction is that [domestic] pension funds and hedge funds did not sell," says Danny Gabay, a former Bank of England official and now a consultant at Fathom Consulting in London.

"That means the quantitative easing is going to do [the UK economy] less good" as the new cash goes overseas.

Measured against the Japanese Yen today – the world's strongest currency during the asset-price collapse of 2008 – Gold Bullion meantime jumped 3.2% at the Tocom Exchange in Tokyo.

Recovering its level of this time last year, the Gold Price in Yen has now risen 48% from the 31-month low it hit in October.

"We're seeing the purchasing power of money eroded," said one RBS analyst in London to Bloomberg this morning.

"As the recession bites, people want access to real money and there's no higher real money than gold."

In Switzerland today, where the Swiss National Bank said this week it will start selling Francs on the open market to try and depress their value, new data showed import prices falling faster than expected last month, down 1.8% in Feb. after falling 0.9% in Jan.

Retail sales in the European monetary zone rose less quickly than analysts hoped, meantime, but Labor Costs for the end of 2008 showed a sharper than expected rise of 3.8% year-on-year.

US import prices fell 0.2% in Feb., the Labor Dept. said Friday morning, much less than Jan.'s 1.1% drop and slower than the 0.8% drop forecast on Wall Street.

Overall, the United States recorded a $36 billion trade deficit for January, pumping out less than two-thirds of the dollars spent overseas compared with Jan. 2008.

"Only when we have confidence can we have courage and strength, and only when we have courage and strength can we overcome difficulties," said Chinese premier Jiabao Wen at the close of a 9-day parliamentary session this morning.

Speaking in Beijing, Wen hinted that any dip in China's GDP growth below 8% would spark a fresh stimulus package on top of the half-trillion-dollar program already begun.

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 2009

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