Best of the Week
Most Popular
1. US Housing Market Real Estate Crash The Next Shoe To Drop – Part II - Chris_Vermeulen
2.The Coronavirus Greatest Economic Depression in History? - Nadeem_Walayat
3.US Real Estate Housing Market Crash Is The Next Shoe To Drop - Chris_Vermeulen
4.Coronavirus Stock Market Trend Implications and AI Mega-trend Stocks Buying Levels - Nadeem_Walayat
5. Are Coronavirus Death Statistics Exaggerated? Worse than Seasonal Flu or Not?- Nadeem_Walayat
6.Coronavirus Stock Market Trend Implications, Global Recession and AI Stocks Buying Levels - Nadeem_Walayat
7.US Fourth Turning Accelerating Towards Debt Climax - James_Quinn
8.Dow Stock Market Trend Analysis and Forecast - Nadeem_Walayat
9.Britain's FAKE Coronavirus Death Statistics Exposed - Nadeem_Walayat
10.Commodity Markets Crash Catastrophe Charts - Rambus_Chartology
Last 7 days
Tech Stocks Trending Towards the Quantum AI EXPLOSION! - 9th Jul 20
Gold and Silver Seasonal Trend Analysis - 9th Jul 20
Facebook and IBM Tech Stocks for Machine Learning Mega-Trend Investing 2020 - 9th Jul 20
LandRover Discovery Sport Service Blues, How Long Before Oil Change is Actually Due? - 9th Jul 20
Following the Gold Stock Leaders as the Fed Prints - 9th Jul 20
Gold RESET Breakout on 10 Reasons - 9th Jul 20
Fintech facilitating huge growth in online gambling - 9th Jul 20
Online Creative Software Development Service Conceptual Approach - 9th Jul 20
Coronavirus Pandemic UK and US Second Waves, and the Influenza Doomsday Scenario - 8th Jul 20
States “On the Cusp of Losing Control” and the Impact on the Economy - 8th Jul 20
Gold During Covid-19 Pandemic and Beyond - 8th Jul 20
UK Holidays 2020 - Driving on Cornwall's Narrow Roads to Bude Caravan Holiday Resort - 8th Jul 20
Five Reasons Covid Will Change SEO - 8th Jul 20
What Makes Internet Packages Different? - 8th Jul 20
Saudi Arabia Eyes Total Dominance In Oil And Gas Markets - 7th Jul 20
These Are the Times That Call for Gold - 7th Jul 20
A Reason to be "Extra-Attentive" to Stock Market Sentiment Measures - 7th Jul 20
The Beatings Will Continue Until the Economy Improves - 6th Jul 20
The Corona Economic Depression Is Here - 6th Jul 20
Stock Market Short-term Peaking - 6th Jul 20
Gold’s Major Reversal to Create the “Handle” - 5th July 20
Gold Market Manipulation And The Federal Reserve - 5th July 20
Overclockers UK Custom Build PC Review - 1. Ordering / Stock Issues - 5th July 20
How to Bond With Your Budgie / Parakeet With Morning Song and Dance - 5th July 20
Silver Price Trend Forecast Summer 2020 - 3rd Jul 20
Silver Market Is at a Critical Juncture - 3rd Jul 20
Gold Stocks Breakout Not Confirmed Yet - 3rd Jul 20
Coronavirus Strikes Back. But Force Is Strong With Gold - 3rd Jul 20
Stock Market Russell 2000 Gaps Present Real Targets - 3rd Jul 20
Johnson & Johnson (JNJ) Big Pharma Stock for Machine Learning Life Extension Investing - 2nd Jul 20
All Eyes on Markets to Get a Refreshed Outlook - 2nd Jul 20
The Darkening Clouds on the Stock Market S&P 500 Horizon - 2nd Jul 20
US Fourth Turning Reaches Boiling Point as America Bends its Knee - 2nd Jul 20
After 2nd Quarter Economic Carnage, the Quest for Philippine Recovery - 2nd Jul 20
Gold Completes Another Washout Rotation – Here We Go - 2nd Jul 20
Roosevelt 2.0 and ‘here, hold my beer' - 2nd Jul 20
U.S. Dollar: When Almost Everyone Is Bearish... - 1st Jul 20
Politicians Prepare New Money Drops as US Dollar Weakens - 1st Jul 20
Gold Stocks Still Undervalued - 1st Jul 20
High Premiums in Physical Gold Market: Scam or Supply Crisis? - 1st Jul 20
US Stock Markets Enter Parabolic Price Move - 1st Jul 20
In The Year 2025 If Fiat Currency Can Survive - 30th Jun 20
Gold Likes the IMF Predicting a Deeper Recession - 30th Jun 20
Silver Is Still Cheap For Now - 30th Jun 20
More Stock Market Selling Ahead - 30th Jun 20
Trending Ecommerce Sites in 2020 - 30th Jun 20
Stock Market S&P 500 Approaching the Precipice - 29th Jun 20
APPLE Tech Stock for Investing to Profit from the Machine Learning Mega trend - 29th Jun 20
Student / Gamer Custom System Build June 2020 Proving Impossible - Overclockers UK - 29th Jun 20
US Dollar with Ney and Gann Angles - 29th Jun 20
Europe's Banking Sector: When (and Why) the Rout Really Began - 29th Jun 20
Will People Accept Rampant Inflation? Hell, No! - 29th Jun 20
Gold & Silver Begin The Move To New All-Time Highs - 29th Jun 20
US Stock Market Enters Parabolic Price Move – Be Prepared - 29th Jun 20
Meet BlackRock, the New Great Vampire Squid - 28th Jun 20
Stock Market S&P 500 Approaching a Defining Moment - 28th Jun 20

Market Oracle FREE Newsletter

AI Stocks 2020-2035 15 Year Trend Forecast

Gold Living Up to Safe Haven Reputation

Commodities / Gold and Silver 2012 Nov 08, 2012 - 01:33 PM GMT

By: Ben_Traynor

Commodities

Best Financial Markets Analysis ArticleSPOT MARKET gold prices hovered just below $1720 an ounce Thursday morning in London – 2.4% up on last week's close – while stocks recovered some ground following losses yesterday, and the Dollar ticked higher, as central banks in the UK and Europe left monetary policy unchanged.

Silver prices hovered close to $32 an ounce – 3.4% up on the week so far – while other commodities edged higher. US Treasury bond prices gained while those for UK and German government debt fell.


"Gold is holding up well in the face of Dollar strength yesterday and today," says commodities strategist Walter de Wet at Standard Bank.

A day earlier, the Dow Jones saw its biggest one-day drop this year on Wednesday, falling 2.4%.

The S&P 500 also fell 2.4%, the biggest one-day drop since the start of June, as focus shifted to Congress's prospects of avoiding the so-called fiscal cliff of tax cut expiries and spending cuts currently scheduled for the start of 2013.

Policies aimed at avoiding the fiscal cliff would mean that "the marginal income-tax rate is probably going to go up...from 35% to 40%, capital gains from 15% to 20%, dividends from 15% to who knows where," Bill Gross, co-chief investment officer at world's largest bond fund Pimco told Bloomberg Tuesday.

"And ultimately if dividend and capital-gains tax rates go up, then stocks are worth less and that's what you’re seeing."

In contrast with stocks, gold prices rallied yesterday after an initial drop at the start of US trading, holding onto most of their gains for the week so far.

"Gold is displaying relative strength and living up to its reputation as a store of value and a safe haven," says this morning's commodities note from Commerzbank.

"Gold ETFs tracked by Bloomberg saw their gold holdings surge by more than 4 tonnes to a new record high of 2592 tonnes."

The European Central Bank left its key interest rate on hold at a record low 0.75 % Thursday.
In a speech in Germany on Wednesday, ECB president Mario Draghi argued that Eurozone inflation "is well contained" and that the ECB expects it to fall below 2% next year.

In yesterday's speech Draghi also denied that a banking union would necessarily lead to cross-border deposit guarantees.

"Organizing and funding deposit guarantee schemes can remain a national responsibility," said Draghi, "with comparable effectiveness."

The Greek government narrowly won a vote in favor of fresh austerity measures last night. The vote was passed 153 to 128 out of a total of 300, while the two biggest coalition parties expelled seven members between them for failing to support the measures.

Spain's government meantime is considering selling 109-year-old palace Castellana in the heart of Madrid in order to raise cash, newswire Bloomberg reports, citing an unnamed source.

Euro gold prices traded just below €43,400 per kilo (€1350 per ounce) this morning, within 2.7% of last month's all-time high. Dollar gold prices by contrast are around 10% off last year's record.

Here in London, the Bank of England today voted to leave interest rates at a record low 0.5% for the 45th month in a row. The Bank's Monetary Policy Committee decided not to extend the £375 quantitative easing program, which ends this month.

"QE still has a benefit and those benefits will stay there," reckons Alan Clarke, London-based economist at Scotia Capital.

"They're not unwinding any purchases...they won't close the door on it, they'll leave their options open."

"The UK outlook and data are rather mixed," adds ABN Amro economist Joost Beaumont.
"Activity is worsening, and Eurozone problems are still lingering."

Employees at Goldman Sachs were the biggest contributors to Mitt Romney's election campaign, according to figures published by website Open Secrets. The top five political action committees (PACs) that contributed to the Republican were all investment banks. Barack Obama's biggest contributor was the PAC at the University of California.

China meantime will not turn its back on one party rule, outgoing president Hu Jintao told the 18th Communist Party Congress on Thursday. The Congress will see seven new members of the Politburo Standing Committee named, including replacements for Hu and Chinese premier Wen Jiabao.

Total credit growth in China has been 16%, according to figures published by Standard Chartered, while the economy, measured by nominal GDP growth, has only grown by 10%.

"Growth needs to be achieved through real structural reforms that lift productivity rather than by adding leverage," says a note from the bank.

"Otherwise, China will have a date with a financial crisis."

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 2012

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