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
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - 30th Nov 21
Omicron Covid Wave 4 Impact on Financial Markets - 30th Nov 21
Can You Hear It? That’s the Crowd Booing Gold’s Downturn - 30th Nov 21
Economic and Market Impacts of Omicron Strain Covid 4th Wave - 30th Nov 21
Stock Market Historical Trends Suggest A Strengthening Bullish Trend In December - 30th Nov 21
Crypto Market Analysis: What Trading Will Look Like in 2022 for Novice and Veteran Traders? - 30th Nov 21
Best Stocks for Investing to Profit form the Metaverse and Get Rich - 29th Nov 21
Should You Invest In Real Estate In 2021? - 29th Nov 21
Silver Long-term Trend Analysis - 28th Nov 21
Silver Mining Stocks Fundamentals - 28th Nov 21
Crude Oil Didn’t Like Thanksgiving Turkey This Year - 28th Nov 21
Sheffield First Snow Winter 2021 - Snowballs and Snowmen Fun - 28th Nov 21
Stock Market Investing LESSON - Buying Value - 27th Nov 21
Corsair MP600 NVME M.2 SSD 66% Performance Loss After 6 Months of Use - Benchmark Tests - 27th Nov 21
Stock Maket Trading Lesson - How to REALLY Trade Markets - 26th Nov 21
SILVER Price Trend Analysis - 26th Nov 21
Federal Reserve Asks Americans to Eat Soy “Meat” for Thanksgiving - 26th Nov 21
Is the S&P 500 Topping or Just Consolidating? - 26th Nov 21
Is a Bigger Drop in Gold Price Just Around the Corner? - 26th Nov 21
Financial Stocks ETF Sector XLF Pullback Sets Up A New $43.60 Upside Target - 26th Nov 21
A Couple of Things to Think About Before Buying Shares - 25th Nov 21
UK Best Fixed Rate Tariff Deal is to NOT FIX Gas and Electric Energy Tariffs During Winter 2021-22 - 25th Nov 21
Stock Market Begins it's Year End Seasonal Santa Rally - 24th Nov 21
How Silver Can Conquer $50+ in 2022 - 24th Nov 21
Stock Market Betting on Hawkish Fed - 24th Nov 21
Stock Market Elliott Wave Trend Forecast - 24th Nov 21
Your once-a-year All-Access Financial Markets Analysis Pass - 24th Nov 21
Did Zillow’s $300 million flop prove me wrong? - 24th Nov 21
Now Malaysian Drivers Renew Their Kurnia Car Insurance Online With - 24th Nov 21
Gold / Silver Ratio - 23rd Nov 21
Stock Market Sentiment Speaks: Can We Get To 5500SPX In 2022? But 4440SPX Comes First - 23rd Nov 21
A Month-to-month breakdown of how Much Money Individuals are Spending on Stocks - 23rd Nov 21
S&P 500: Rallying Tech Stocks vs. Plummeting Oil Stocks - 23rd Nov 21
Like the Latest Bond Flick, the US Dollar Has No Time to Die - 23rd Nov 21
Cannabis ETF MJ Basing & Volatility Patterns - 22nd Nov 21
The Most Important Lesson Learned from this COVID Pandemic - 22nd Nov 21
Dow Stock Market Trend Analysis - 22nd Nov 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Frightened Investors Drive Gold to Four Week High 

Commodities / Gold & Silver 2009 Mar 20, 2009 - 08:49 AM GMT

By: Adrian_Ash

Commodities THE SPOT PRICE OF GOLD fell hard in early London trade Friday, losing almost 2% from new one-month highs hit overnight at $966 an ounce.

The Spot Gold Price held near its best weekly finish vs. the US Dollar since Feb. 20, however.

For UK and Eurozone investors Ready to Buy  Gold today, the price was little changed as the US Dollar rallied on the currency markets, bouncing from its worst one-day tumble since the mid-1980s.

Gold in Sterling and Euros held at £660 and €700 an ounce respectively.

"Demand for small Gold Bars and coins as a long-term insurance product is very firm," notes London wholesale dealer Mitsui in its latest Refining Monitor today.

"The Kruggerand remains at maximum production capacity. For the US Mint, demand for the American Eagle hit 92,000 ounces in January, then 113,500 in February."

The Royal Canadian Mint told Reuters last week that it "quadrupled its capacity" to produce Maple Leaf coins in late 2008.

In the secondary market, US dealers are now charging premiums of 8% and more for plain bullion coins, reports Financial News.

Across in India, however, "Gold plunging 10% from its 2009 high to $900 [earlier this month] did not stop the flow of recycling metal or ignite fresh buying," Mitsui goes on. The world's No.1 jewelry consumer is now "swamped" with scrap metal, driving local quotes down to a $30-$40 discount to London prices.

For Gold Investment , "We think that the Fed's action [this week] will change the focus of the gold market from risk appetite/aversion back toward the Dollar and prospects for inflation," reckons Tom Pawlicki, analyst at MF Global in London, speaking to the Financial Times earlier.

"This outcome could attain greater credence if the stock market has in fact bottomed."

Asian stocks fell Friday morning, while Japan was closed for the Spring Equinox holiday. But European shares managed to crawl higher, with Germany's Dax heading for a 2.3% week-on-week gain.

US crude oil futures dropped $1 to trade right at $50 per barrel. Bond yields were mixed, falling further on UK debt but ticking higher on long-term German bunds.

"Not only gold rose yesterday," notes Walter de Wet at Standard Bank in a note to clients; "all commodities rallied, spurred by the free-falling US Dollar.

"We now believe that, while the Dollar won't free-fall [vs. the Euro], it could approach $1.40 sooner than generally expected."

Looking further ahead for Gold in 2009, new buying "has to overcome the heavy supply of scrap and sharp decline in jewelry demand," de Wet says. "For this to happen, investment demand must continue to grow."

Demand for gold-price exposure through the Gold ETF trust funds rose again Thursday, pushing the volume of bullion used to back the SPDR shares traded in New York up by 19 tonnes to a new record of 1,103 tonnes.

The SPDR's hoard – primarily held, according to its trust-fund documentation – at HSBC Bank in London – has swelled by 7% already this month.

"My stance towards gold is that you should buy a little bit every month," said Dr.Marc Faber, the famously contrarian and gloomy Swiss fund manager – now based in Thailand, and long of gold right through this decade – to India's CNBC-TV18 this week.

"Become your own central bank, because you can't trust Central Banks anymore to act responsibly and maintain the function of paper money as a store for value. You want your own reserve."

By Adrian Ash

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 , 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 - 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