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
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
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
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 Up 5% on Week in Euros as Recession Data Hits Europe

Commodities / Gold and Silver 2012 Jan 06, 2012 - 07:13 AM GMT

By: Ben_Traynor


Best Financial Markets Analysis ArticleTHE DOLLAR cost of buying gold hovered around $1620 an ounce Friday morning London time – becoming a bit more volatile following the release of US employment data but failing to establish a definite direction – while stocks and commodities edged higher.

Silver prices meantime eased around lunchtime, hitting $29.15 per ounce.

On currency markets the Dollar rallied – pushing the Euro down further – after the nonfarm payrolls release showed the US economy added 200,000 private sector non-agricultural jobs in December.

The US unemployment rate fell from 8.7% in November (revised up today from 8.6%) to 8.5%.

From its high above $1.30 on Tuesday, the Euro meantime has since fallen 2.5% against the Dollar. 

By Friday lunchtime the price of buying gold in Euros – which touched a 4-week high of €40994 per kilo (€1275 per ounce) looked set for a weekly gain of over 5%.

The Dollar cost of buying gold meantime was headed for a weekly gain of around 3.6%.

"A close above the 200 day moving average at $1632 is needed to shift the market [for buying gold] to Neutral from Bearish," reckons Russell Browne, technical analyst at bullion bank Scotia Mocatta.

"While gold is pushing towards its 200 day moving average at $1633, we are not convinced that it can sustain a break above this level yet," adds Standard Bank commodities strategist Walter de Wet.

"Liquidity remains locked up as the European interbank market continues to the physical market, we continue to see steady buying of gold. But this demand is more likely to provide support for gold on dips below $1600 rather than push it substantially higher."

Friday's Asian trade saw demand for buying gold in physical form, according to one Shanghai trader.

"Liquidity is back in the market," said the trader.

"With the Europe outlook still grim, investors would prefer to put their dollars in some safety assets, such as gold."

In the US, however, the volume of gold to held to back shares in the world's largest gold ETF, the SPDR Gold Trust (GLD), has not changed since before Christmas.

This contrasts with the world's biggest silver ETF, the iShares Silver Trust (SLV), where steady outflows since the middle of last month has seen the volume of silver bullion held fall to its lowest level since September 2010.

"We expect silver demand to slow during [2012]," says the latest precious metals note from French bank Natixis, citing "reduced investment demand alongside the current weakness in global industrial demand."

"There have been good data out of the US," said Jeremy Friesen, Hon Kong-based commodity strategist at Societe Generale, speaking ahead of today's nonfarm payrolls release.

"But ultimately the US can't decouple from the European crisis...there are going to be enough reasons to be worried about global growth and the financial system in the next quarter or two, and gold should benefit from that."

German factory orders fell 4.8% between October and November last year, Bundesbank figures published this morning show. 

Retail sales for the 17-nation Eurozone as a whole meantime fell 2.5% in the year to November – compared to a 0.7% y-o-y drop to October – according to official European Union data, while the European Commission's economic confidence indicator hit its lowest level in over two years last month.

"This data has recession written all over it," says Martin van Vliet, Eurozone economist at Dutch bank ING.

A report in French newspaper Les Echos suggests the governments of France, Belgium and Luxembourg are considering fully nationalizing Dexia. The three governments pledged last October to guarantee for a decade €90 billion of the bank's loans, nationalizing its Belgian division.

In Switzerland meantime Phillip Hildebrand, head of the Swiss National Bank – which last year pegged the Swiss Franc to the Euro – has refused to resign after it emerged that his wife bought US Dollars three weeks before the peg was announced.

Here in the UK – where the Pound this morning hit a 15-month high against the Euro – oil company Shell has announced it will close its final salary pension scheme, the last FTSE 100-listed company to do so.

The Sterling price of buying gold hit £1052 per ounce Friday lunchtime in London – 4.6% up on the start of the week.

Hungary's leader Viktor Orban has expressed support for central bank governor Andras Simor as the government prepares to renew negotiations with the International Monetary Fund and the European Union over a possible bailout. The IMF and EU last month walked away from negotiations after Orban's government refused to repeal new legislation seen as threatening the central bank's independence.

By Ben Traynor

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 - 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