Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Dow Stock Market Short-term and Long-term Trend Analysis - 28th Nov 20
How To Spot The End Of An Excess Market Trend Phase – Part II - 28th Nov 20
BLOCKCHAIN INVESTMENT PRIMER - 28th Nov 20
The Gold Stocks Correction is Maturing - 28th Nov 20
Biden and Yellen Pushed Gold Price Down to $1,800 - 28th Nov 20
Sheffield Christmas Lights 2020 - Peace Gardens vs 2019 and 2018 - 28th Nov 20
MUST WATCH Before You Waste Money on Buying A New PC Computer System - 27th Nov 20
Gold: Insurance for Prudent Investors, Precious Metals Reduce Risk & Preserve Wealth - 27th Nov 20
How To Spot The End Of An Excess Market Trend Phase - 27th Nov 20
Snow Falling Effect Christmas Lights Outdoor Projector Amazon Review - 27th Nov 20
4 Reasons Why You Shouldn't Put off Your Roof Repairs - 27th Nov 20
Further Clues Reveal Gold’s Weakness - 26th Nov 20
Fun Things to Do this Christmas - 26th Nov 20
Industries that Require Secure Messaging Apps - 26th Nov 20
Dow Stock Market Trend Analysis - 25th Nov 20
Amazon Black Friday Dell 32 Inch S3220DGF VA Curved Screen Gaming Monitor Bargain Deal! - 25th Nov 20
Biden the Silver Bull - 25th Nov 20
Inflation Warning to the Fed: Be Careful What You Wish For - 25th Nov 20
Financial Stocks Sector ETF Shows Unique Island Setup – What Next? - 25th Nov 20
Herd Immunity or Herd Insolvency: Which Will Affect Gold More? - 25th Nov 20
Stock Market SEASONAL TREND and ELECTION CYCLE - 24th Nov 20
Amazon Black Friday - Karcher K7 FC Pressure Washer Assembly and 1st Use - Is it Any Good? - 24th Nov 20
I Dislike Shallow People And Shallow Market Pullbacks - 24th Nov 20
Small Traders vs. Large Traders vs. Commercials: Who Is Right Most Often? - 24th Nov 20
10 Reasons You Should Trade With a Regulated Broker In UK - 24th Nov 20
Stock Market Elliott Wave Analysis - 23rd Nov 20
Evolution of the Fed - 23rd Nov 20
Gold and Silver Now and Then - A Comparison - 23rd Nov 20
Nasdaq NQ Has Stalled Above a 1.382 Fibonacci Expansion Range Three Times - 23rd Nov 20
Learn How To Trade Forex Successfully - 23rd Nov 20
Market 2020 vs 2016 and 2012 - 22nd Nov 20
Gold & Silver - Adapting Dynamic Learning Shows Possible Upside Price Rally - 22nd Nov 20
Stock Market Short-term Correction - 22nd Nov 20
Stock Market SPY/SPX Island Setups Warn Of A Potential Reversal In This Uptrend - 21st Nov 20
Why Budgies Make Great Pets for Kids - 21st Nov 20
How To Find The Best Dry Dog Food For Your Furry Best Friend?  - 21st Nov 20
The Key to a Successful LGBT Relationship is Matching by Preferences - 21st Nov 20
Stock Market Dow Long-term Trend Analysis - 20th Nov 20
Margin: How Stock Market Investors Are "Reaching for the Stars" - 20th Nov 20
World’s Largest Free-Trade Pact Inspiration for Global Economic Recovery - 20th Nov 20
Dating Sites Break all the Stereotypes About Distance - 20th Nov 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Gold Hits New UK Sterling High

Commodities / Gold & Silver 2009 Nov 20, 2009 - 08:09 AM GMT

By: Adrian_Ash

Commodities

THE PRICE OF GOLD slipped for the second day running for Dollar investors early in London on Friday, nearing the weekend 1.7% above last week's finish as commodities fell, government bonds rose, and world stock markets dropped.

Gold priced in British Pounds hit a new all-time record at the AM Gold Fix of £690.83 per ounce.


Agreed as a clearing and benchmark price twice each day, the Fix has risen by 280% for UK gold buyers from this time 10 years ago.

"We do not expect much direction from currencies," says today's gold-market comment from Standard Bank analyst Walter de Wet.

"In fact, correlations between commodities and the Dollar have fallen substantially. Look to equities for direction."

The price of gold has risen by 19% vs. the Dollar since the start of Sept. Priced against a basket of currencies, the Dollar itself has lost 4.5% of its value since then.

The S&P 500 index of US stocks has risen 7.3% in that time.

Today world stock markets slipped back, dropping for the seventh day out of 15 trading sessions in November so far.

Silver traded wholesale in 1,000-ounce bars slid further from Wednesday's 16-month high, recording a London Fix of $18.18 and dropping almost 4.0% in 48 hours.

"Raise interest rates with 15 million jobless and 25 million part-time working Americans?" writes Pimco bond-fund giant Bill Gross in his latest Investment Outlook.

"All because gold is above $1100? You must be joking or smoking something.

"We will need another 12 months of 4-5% nominal GDP growth before Bernanke and company dare lift their heads out of the 0% foxhole – mini-bubbles or not."

The Bank of Japan today kept its key interest rate at 0.1%. It was first cut below 1.0% per year in 1995.

Thursday's action saw the nominal return offered by US Treasury bills maturing in January drop below 0%, the first such sub-zero yield – before accounting for inflation – since Dec. last year.

Morgan Stanley economist Ted Wieseman attributes the sub-zero yields, caused by surging prices, to "investors stash[ing] money over year-end."

Last week's US consumer-price data showed inflation running above 2.5% annualized.

"The biggest threat to the gold price in 2010 will come from macroeconomic factors," warn VM Group analysts Matt Turner and Carl Firman today, "such as a concerted effort by the US government to rein-in the money supply and support the Dollar.

"[That] possibility, however, is remote in our view."

Estimating that the physical gold market will see demand lag supply by at least 282 tonnes in 2009, "We anticipate the surplus may be repeated in 2010," say VM, launching its latest Yellow Book of data and analysis on behalf of BNP Paribas Fortis.

"A recovery in jewelry demand [will be] offset by a decline in dehedging and a further increase in mine supply. Price direction will again depend heavily on investors’ willingness to add to their holdings."

Commenting on Europe's financial outlook, "Euro area governments...have committed 26% of GDP to supporting the financial sector," noted European Central Bank chief Jean-Claude Trichet in a keynote speech this morning in Frankfurt.

"The total amount of outstanding ECB refinancing [to commercial banks] is around 60% larger than it was before the market turmoil. This reflects also the need for the ECB to 'intermediate' parts of the money market."

New data today showed Germany's wholesale price index holding flat in Oct., defying market expectations of a slight increase as the rising Euro undid crude oil's jump in Dollars.

Eurozone interest rates now stand at 1.0%. Today the gold price in Euros held €1 shy of yesterday's nine-month high at €770 an ounce.

Eurozone investors looking to buy gold have seen the price rise 15% since the start of Sept. this year and more than 135% since Nov. 2004.

By Adrian Ash
BullionVault.com

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