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
Silver Price 2021 Roadmap - 22nd Jan 21
Why Biden Wants to Win the Fight for $15 Federal Minimum Wage - 22nd Jan 21
Here’s Why Gold Recently Moved Up - 22nd Jan 21
US Dollar Decline creates New Sector Opportunities to Trade - 22nd Jan 21
Sandisk Extreme Micro SDXC Memory Card Read Write Speed Test Actual vs Sales Pitch - 22nd Jan 21
NHS Recommends Oximeter Oxygen Sensor Monitors for Everyone 10 Months Late! - 22nd Jan 21
DoorDash Has All the Makings of the “Next Amazon” - 22nd Jan 21
How to Survive a Silver-Gold Sucker Punch - 22nd Jan 21
2021: The Year of the Gripping Hand - 22nd Jan 21
Technology Minerals appoints ex-BP Petrochemicals CEO as Advisor - 22nd Jan 21
Gold Price Drops Amid Stimulus and Poor Data - 21st Jan 21
Protecting the Vulnerable 2021 - 21st Jan 21
How To Play The Next Stage Of The Marijuana Boom - 21st Jan 21
UK Schools Lockdown 2021 Covid Education Crisis - Home Learning Routine - 21st Jan 21
General Artificial Intelligence Was BORN in 2020! GPT-3, Deep Mind - 20th Jan 21
Bitcoin Price Crash: FCA Warning Was a Slap in the Face. But Not the Cause - 20th Jan 21
US Coronavirus Pandemic 2021 - We’re Going to Need More Than a Vaccine - 20th Jan 21
The Biggest Biotech Story Of 2021? - 20th Jan 21
Biden Bailout, Democrat Takeover to Drive Americans into Gold - 20th Jan 21
Pandemic 2020 Is Gone! Will 2021 Be Better for Gold? - 20th Jan 21
Trump and Coronavirus Pandemic Final US Catastrophe 2021 - 19th Jan 21
How To Find Market Momentum Trades for Explosive Gains - 19th Jan 21
Cryptos: 5 Simple Strategies to Catch the Next Opportunity - 19th Jan 21
Who Will NEXT Be Removed from the Internet? - 19th Jan 21
This Small Company Could Revolutionize The Trillion-Dollar Drug Sector - 19th Jan 21
Gold/SPX Ratio and the Gold Stock Case - 18th Jan 21
More Stock Market Speculative Signs, Energy Rebound, Commodities Breakout - 18th Jan 21
Higher Yields Hit Gold Price, But for How Long? - 18th Jan 21
Some Basic Facts About Forex Trading - 18th Jan 21
Custom Build PC 2021 - Ryzen 5950x, RTX 3080, 64gb DDR4 Specs - Scan Computers 3SX Order Day 11 - 17th Jan 21
UK Car MOT Covid-19 Lockdown Extension 2021 - 17th Jan 21
Why Nvidia Is My “Slam Dunk” Stock Investment for the Decade - 16th Jan 21
Three Financial Markets Price Drivers in a Globalized World - 16th Jan 21
Sheffield Turns Coronavirus Tide, Covid-19 Infections Half Rest of England, implies Fast Pandemic Recovery - 16th Jan 21
Covid and Democrat Blue Wave Beats Gold - 15th Jan 21
On Regime Change, Reputations, the Markets, and Gold and Silver - 15th Jan 21
US Coronavirus Pandemic Final Catastrophe 2021 - 15th Jan 21
The World’s Next Great Onshore Oil Discovery Could Be Here - 15th Jan 21
UK Coronavirus Final Pandemic Catastrophe 2021 - 14th Jan 21
Here's Why Blind Contrarianism Investing Failed in 2020 - 14th Jan 21
US Yield Curve Relentlessly Steepens, Whilst Gold Price Builds a Handle - 14th Jan 21
NEW UK MOT Extensions or has my Car Plate Been Cloned? - 14th Jan 21
How to Save Money While Decorating Your First House - 14th Jan 21
Car Number Plate Cloned Detective Work - PY16 JXV - 14th Jan 21
Big Oil Missed This, Now It Could Be Worth Billions - 14th Jan 21
Are you a Forex trader who needs a bank account? We have the solution! - 14th Jan 21
Finetero Review – Accurate and Efficient Stock Trading Services? - 14th Jan 21

Market Oracle FREE Newsletter

FIRST ACCESS to Nadeem Walayat’s Analysis and Trend Forecasts

Gold Steady, Trading in Tight Range

Commodities / Gold and Silver 2011 Jun 09, 2011 - 08:25 AM GMT

By: Ben_Traynor

Commodities

Best Financial Markets Analysis ArticleTHE U.S. DOLLAR gold price continued holding steady on Thursday morning, trading in a tight range around $1536 per ounce – 2.6% off May's spot market record high – while stocks and commodities rose ahead of UK and Eurozone interest rate announcements.

Silver prices gained to hit $37.23 per ounce – 2.7% up on the week so far.


"For the time being it seems that gold ought to stay trapped between $1530 and $1550," says Swiss precious metals group MKS.

"[Gold] is lacking any momentum for a rally while on the other side the support at $1530 seems quite strong."

Gains made by the gold price on Wednesday "don't feel decisive enough" reckons one bullion dealer here in London.

The Bank of England's Monetary Policy Committee voted Thursday to keep interest rates on hold at 0.5%, where it has held rates since March 2009.

The doves – those members of the MPC who are opposed to rate rises – "have the upper hand" at the Bank of England, said Brian Hilliard, London-based economist at Société Générale and a former Bank of England official, speaking before the announcement.

"The market is scaling back its rate expectations," in the face of "concerns about growth" he added.
Across the English Channel, meantime, the European Central Bank also voted to keep its policy rate steady, at 1.25%, its level since April this year.

Analysts on Thursday morning were expecting ECB president Jean-Claude Trichet to use the phrase "strong vigilance" in his afternoon press conference to signal a rate hike next month.

"The data from the Eurozone has held up remarkably well in recent weeks in contrast to countries like the US and the UK," Derek Halpenny, European head of global currency research at Bank of Tokyo-Mitsubishi told the Financial Times on Thursday morning.

Figures published Wednesday show that Eurozone GDP for the first quarter of the year grew 2.5% compared to the same period last year. By comparison, the UK economy grew 0.5% over the same period, while US data show growth at 1.8%.

Signaling a rate hike "reinforces the credibility of the ECB, which strives to highlight...that its role is to deliver price stability not solve the Eurozone debt crisis," said Halpenny.

"Greece is only a risk scenario for the ECB," adds Ken Wattret, chief euro-region economist at BNP Paribas in London.

"Assuming that the Greek problem doesn't become systemic, the ECB will press on." 

Both interest rate announcements had little immediate impact on the gold price.

In Vienna, meantime, the Organization of Petroleum Exporting Countries (OPEC) failed on Wednesday to agree on production quotas, after Iran persuaded five other members to vote against Saudi Arabia's proposal to raise output by 1.5 million barrels a day. 

The five included Libya, whose production – which stood at 1.58 million barrels a day in January – is cut off from the world market as a result of ongoing conflict.

OPEC's failure is "bullish" for oil prices, says Andrey Kryuchenkov, London-based analyst at VTB Capital.

"The market remains undersupplied."

Libyan production, which stood at nearly 1.6 million barrels a day in January, has been offline since military action began in the country. 

"Spare capacity is not what has been portrayed by OPEC," adds Lawrence Eagles, head of energy research at JP Morgan.

"Every OPEC member [will have to] produce at its maximum in the next few months to ensure the oil market is well supplied."

Over in the US, ratings agency Fitch has joined Standard & Poor's and Moody's in warning that the country's triple-A credit rating is at risk.

Fitch warned Wednesday that failure to agree an increase in the federal debt limit by August 2 would "imply a crisis of governance", and would risk the US missing payments on Treasury notes due on August 15.

Fitch warns that if that happens, the US would be in "restricted default", and Fitch would temporarily downgrade its debt to junk status.

Last week Moody's said it would place the US under review for possible downgrade if there no progress on raising the debt limit. Standard & Poor's changed its outlook on the US rating from "stable" to "negative" in April.

By Ben Traynor
BullionVault.com

Gold price chart, no delay   |   Buy gold online at live prices

Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK's longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics.

(c) BullionVault 2011

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.


© 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