Gold and silver are marginally lower against most currencies after yesterday’s 1% and 3% rise respectively. Gold rose above €1,000/oz again yesterday and remains just below the €1,000/oz level today despite the euro being stronger versus other currencies. Silver is back above the important $30/oz psychological level and €22/oz.
Gold is higher in most currencies today except for the Aussie and Kiwi dollars; silver has risen by some 1% in US dollars and is higher against all currencies. Asian equities were mixed with the Nikkei higher (+0.41%) and the Hang Seng lower (-0.29%). European equities are mixed with tentative gains being seen in the BE 500 and the Stoxx 50.
Gold is marginally lower in euro, pound and dollar terms and marginally higher in Japanese yen and Swiss francs. Silver is higher in all currencies. With gold’s 0.51% higher close last week (first rise in 5 weeks) and silver’s 4% rally, the bears will be nervous that the recent downward trend may have reversed.
Gold and silver have given up a small bit of yesterday’s strong gains in all currencies (especially the euro – see chart below) but are up more than 1% and 3% respectively on the week. Asian equity indices were higher overnight and are higher for the week, except for India where there are growing concerns about surging inflation and interest rates. European indices are higher today and most are up by some 1.5% to 2% on the week – as are US indices.
The Swiss franc and the euro are weaker today and marginally lower against gold. Asian equity markets were higher (except for a 0.25% fall in the Nikkei) but European indices are more hesitant this morning. Greek, Italian and Spanish debt markets have seen yields creep slightly higher this morning.
Hopes of economic recovery swept stocks higher in New York yesterday and this confidence spread to Asian equity markets. European stocks are tentatively higher as concerns about Egypt and geopolitical risk may be hampering gains. Oil prices remain near recent record highs (brent rose above $102 a barrel) and there are hopes that geopolitical tensions will subside, markets will remain calm and there will not be panic buying of oil and a new oil crisis.
Spot gold and silver fell 6% and 9% respectively in January. The January price fall looks very much like another price correction and consolidation and is to be expected after the 30% rise in dollar terms seen in 2010. Absolutely nothing has changed with regard to the fundamentals of the gold and silver market and investors should use this sell off as another opportunity to diversify into the precious metals.
The geopolitical ramifications of the revolution in Egypt and the likelihood that it will spread throughout the Middle East, North Africa and possibly further afield is leading to volatility in markets. Equity indices in the Middle East and Far East were mostly down (except for China) overnight. European bourses were under pressure this morning but have recovered somewhat.
The World Gold Council released their excellent quarterly 'Gold Investment Digest'. The research has some interesting facts and important charts and shows that global demand was robust and broad based for both the final quarter and the year. Those continuing to call gold a bubble, often based on a lack of knowledge of the gold market, and failing to advise diversification, should read the report.
What were termed "shock" UK GDP figures yesterday, led to falls in the FTSE and the pound sterling which fell against the dollar and gold. Sterling's fall saw sterling gold prices rise from £833 per ounce to over £842 per ounce after the news. Economists were once again surprised by the very poor UK GDP figures which showed the economy has contracted by 0.5% rather than growth of 0.5%. This clearly shows that the UK is now experiencingstagflation or high inflation and very low or contracting economic growth.
Gold and silver's sell off has continued this morning. Despite gold's 3.75% and silver's nearly 8.4% fall in January and the continued sell off in futures markets, physical demand remains robust and supply tight. While speculators are taking profits and some shorting, investors and those who see gold as a store of value continue to accumulate physical.
After gains in Asia, the precious metals have come under pressure in Europe. The recent sharp sell off has seen gold fall 5.7% in January. Nothing whatsoever has changed regarding the fundamentals of the precious metal markets and long term buyers are again buying on the dip. As long as interest rates remain near historic lows and real interest rates continue to punish savers, gold's bull market remains sound.
Gold is flat and silver marginally lower despite dollar weakness this morning. Some market participants are blaming the precious metal sell off on speculation that China may take more monetary action to curb surging inflation. This is unlikely to be the reason for the sharp selloff, rather it looks like another paper driven sell off in the futures market by leveraged players on Wall Street with various motives.
GOLD Gold has fallen by 1.7% and silver by 4% as the US dollar has bounced from 2 month lows. Some are attributing the sell off to interest rate hikes in Brazil and the bounce in the dollar. However, it is more likely due to further selling by momentum-driven traders who see that the short term trend is down and they are sticking it to under pressure longs. Gold is currently trading at $1,347.73/oz, €1,004.19/oz and £850.12/oz.
GOLD Gold is slightly higher in the US dollar and other major currencies. Spot silver has given up early gains but the futures market has seen longer term contracts fall more in price so that while spot is up $0.09 to $28.96/oz, the July 11 contract is only trading up $0.01 to $29.00 and and the December 11 contract has fallen by $0.084 to $29.01. The dollar has fallen to 78.42 on the US Dollar Index and is looking technically vulnerable of falling to long term support at 76.0.
*** BullionVault Clarification ***
Gold Gold and silver have fallen in most currencies today but are higher in the “commodity currencies” of Canadian, Australian and New Zealand dollars, and flat in Swiss francs. Gold and silver are both slightly higher for the week in US dollar terms but weaker in terms of other currencies. Gold is currently trading at $1,365.95/oz, €1,023.11/oz and £861.20/oz.
Gold Gold and silver have fallen by less than 1% in all major currencies today. Asian equities were mixed with strong selling seen in India and European equities and US index futures are tentatively higher. Eurozone periphery bonds yields have fallen as have those in Germany (10 year) after rising above 3% in recent days. Gold is currently trading at $1,385.30/oz, €1,046.24/oz and £875.67/oz.
Gold Gold is marginally higher in US dollars while silver has risen by nearly 1% in all major currencies this morning. Risk appetite remains highs as seen in higher Asian and European bourses today. The US, Hong Kong and New Zealand dollar are weaker as are Australian and German government bonds (which rose 6 basis points and 4 basis points to 5.51% and 2.96% respectively). Gold is currently trading at $1,383.29/oz, €1,065.88/oz and £887.27/oz.
Gold Gold remains well supported in all major currencies this morning, especially the euro, pound, yen and the New Zealand and Australian dollar. Concerns about inflation, credit bubbles and the growing likelihood that the Eurozone debt crisis will deepen is leading to continuing safe haven demand for gold – particularly in India, China and wider Asia. Gold is currently trading at $1,382.05/oz, €1,067.63/oz and £887.37/oz.
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