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
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
NVIDIA THE KING OF THE METAVERSE! - 10th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
MATTERPORT (MTTR) - DIGITIZING THE REAL WORLD - METAVERSE INVESTING 2022 - 7th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
METAVERSE - NEW LIFE FOR SONY AGEING GAMING GIANT? - 6th Jan 2022
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022
Quantum AI Tech Stocks Portfolio Current State - 4th Jan 2022
The Alibaba Stock Market - 4th Jan 2022
Will Gold & Silver Be Investment Outcasts in 2022 Again? - 4th Jan 2022
Stock Market Happy 2022 Entry - 4th Jan 2022
Complete paradigm shift will make Gold the generational trade - 4th Jan 2022
Corsair MP600 NVME2 1tb Drive Sudden DEATH Failures - Back Up NOW! - 4th Jan 2022
AI Tech Stocks Portfolio Updated Buying Levels and Zones Part 2 of 2 - 3rd Jan 2022
Stock Market Sentiment Speaks: 2022 Can Be Your Best Year Ever - 3rd Jan 2022
2020-22 - Soaring costs of the West's Pandemic failure - 3rd Jan 2022
AUTODESK (ADSK) - CAD - Metaverse Stock Analysis Investing for 2022 and Beyond - 2nd Jan 2022
Stock Market Sector Themes In Play For 2022 - 2nd Jan 2022
Excuse Me Mr Gold. What Year Is It? - 2nd Jan 2022
Stock Market Early 2022 Should Continue Melt-Up Trend In January / February - 2nd Jan 2022
UK Energy Crisis WARNING 2022 - How to Avoid Huge Increase in Gas and Electric Fuel Bills Right Now! - 1st Jan 2022
Why You Need A PR Expert For Your Financial Startup - 1st Jan 2022
TENCENT- Chinese High Risk GAMING Metaverse Stock Analysus for Investing 2022 and Beyond - 31st Dec 21
Gold Price Forecast 2022 - The Golden Year - 31st Dec 21
Will 2022 Be Better for Gold Than 2021? - 31st Dec 21
Gold Stocks – Wishing And Hoping (And Losing) - 31st Dec 21
Sheffield Christmas Market 2021 SANTAS GROTTO at Peace Gardens, City Centre Sights and Sounds - 31st Dec 21
Nvidia Leaves planet Earth - AI Tech Stocks Analysis - 30th Dec 21
Google (Alphabet) AI Tech Stocks Analysis - 30th Dec 21
Stock Market Santa Rally Challenge - 30th Dec 21
Sheffield Christmas Market Stalls, Sights and Sounds 2021 - 30th Dec 21
Investment Roadmap for 2022 - 30th Dec 21
2022 – The Year of (Gold) Inflation? - 30th Dec 21
Overvalued Stocks and Housing Perfect Storm for Gold - 30th Dec 21
My Most surprising Crypto call to date - 30th Dec 21
What is a Rehab Clinic and How It Is Beneficial for People? - 30th Dec 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold Falls as G20 Fight Deflation by Any Means

Commodities / Gold & Silver 2009 Apr 02, 2009 - 08:48 AM GMT

By: Adrian_Ash

Commodities Best Financial Markets Analysis ArticleTHE PRICE OF physical gold fell against all major currencies early Thursday, dropping 2% versus the Dollar as global stock markets jumped and Treasury bonds were sold lower.

Crude oil bounced hard, back above $50 per barrel, as base metals and foodstuffs crept higher.


Ahead of today's G20 communiqué on global stimulus spending and finance regulation from the world leaders meeting in London, the US Dollar fell together with Gold Bullion , spiking to a one-week low vs. the Euro after Eurozone interest rates were cut by less than analysts forecast.

ECB staff had hinted there was "more leeway" to reduce the cost of money – now at 1.25% – after this week's raft of poor data from the 16-nation currency zone was capped by an early "flash" estimate of annual inflation at just 0.6% in March.

"Good physical selling of gold sets in whenever the price breaches $930," says a note from Walter de Wet at Standard Bank in Johannesburg today.

"Although Gold ETF holdings continue to increase, it's not enough for gold to break above $950. For this, we would need to see more investment demand, as we do not expect jewelry demand to support the price."

New York's giant SPDR Gold ETF maintained its record gold backing of 1,147 tonnes once again on Wednesday for the fourth time running, but only the 28th day of no growth in 62 sessions so far this year.

Gold Bullion held by the Zurich Cantonal Bank's Gold ETF in Switzerland meantime swelled by 37.5% between Jan. and end-March, a press release said this morning.

Across in India – formerly the world's No.1 consumer market for physical gold – a new Gold ETF was offered to investors by SBI Bank on Wednesday, despite the disappointing uptake of the four existing schemes.

"If there is one asset class that has clearly benefited from the fall in the equity markets, it's undoubtedly gold," says the Economic Times today, noting that the Sensex index of Indian stocks has dropped 23% since Oct., while the Gold Price in Indian Rupees has risen 15%.

" Gold ETFs have seen an influx of nearly 14% in their asset base since end-Sept. '08," says the paper.

Today world stock markets leapt – adding 7% in Hong Kong and 4% in Frankfurt – on what the newswires called evidence that the US economy "is on the mend".

Here in London, world leaders attending the G20 summit near the Canary Wharf financial district were said to be "close" to agreeing a plan for co-ordinated stimulus and financial rules despite a clear division between Anglo-American and Franco-German delegates.

"I've seen more people turn out to oppose a Tesco supermarket's planning application," says one BBC reporter just beyond the "ring of steel" keeping anti-capitalist and climate change protesters away from the meeting in East London.

"Never has bad looked so good," says USA Today after Wednesday's new that US auto sales leapt 25% month-on-month in March – the first rise in 17 months – but remained well over a third below March 2008, itself down by 8% from a year earlier.

Pending home sales also jumped in Feb., while manufacturing activity shrank less quickly than forecast.

Construction spending fell for the fifth month running.

Here in the United Kingdom, meantime, house prices in March recorded their first month-on-month rise since Oct. 2007, creeping 0.9% higher from Feb. but remaining almost one-fifth below their peak, according to the Nationwide mortgage lender.

UK construction output shrank yet again, meantime, but the pace of decline slowed.

The British Pound rose sharply this morning on the currency markets, breaking four-week highs against the single currency in volatile trade ahead of the European Central Bank's decision.

That squashed the Gold Price in Sterling to a 7-week low beneath £620 an ounce, up by more than one-third from this time last year but an 11% discount to late-Feb.'s new record highs.

French, German and Italian investors now Ready to Buy  Gold saw the price drop 3.3% early Thursday, touching a 6-session low on the ECB's rate-cut beneath €680 an ounce.

"Gold's [now] a very attractive asset class," said Rob Krcmarov, head of exploration at Barrick Mining – the world's No.1 gold miner – at a conference in Santiago, Chile, this week.

"In terms of prices, obviously mine supply is going down. The industry in general is not replacing supply. The rate of discovery is decreasing," Krcmarov told Reuters, noting a 14% drop in global gold output between 2001 and 2009.

Driven by metal ores and mineral sales, Australia's trade balance turned sharply higher in Feb. new data said overnight.

Commodity prices in neighboring New Zealand then bounced in March, according to ANZ Bank, after plunging nearly 5% the month before.

Today in Bern, central-bank chief Philipp Hildebrand confirmed the Swiss National Bank is actively working to devalue its currency, the previously safe-haven "hard money" Franc.

"A renewed appreciation of the Franc contains the risk of a sustained deflationary dynamic in Switzerland," Hildebrand told an asset management forum.

"It's about preventing deflation by all means."

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