Gold
Gold surged on the open in Asia and has range traded between $1,152/oz and $1,159/oz overnight and it has moved upwards in late morning London trading. Gold is currently trading at $1,157.00/oz and in euro and GBP terms, gold is trading at €796/oz and £717/oz respectively. $1,200/oz gold looks like it could be challenged again this week.

The positive economic news out of China following the poor US jobs number on Friday led to a surge in the oil and commodity prices and a fall in the dollar and this led to gold’s strength (surged $24). China’s commodity imports were larger than expected and this in conjunction with the cold weather in much of the northern hemisphere led to higher oil prices, contributing to gold’s strength.

The health of consumers over the Christmas period will be monitored in retail sales data (UK and US) released this week and poor figures could see further risk aversion and a safe haven bid for gold. The US trade deficit is expected to have widened to a still significant $34.6 billion which should make dollar bulls pause for thought.

The euro may come under further pressure due to the risk of further sovereign credit rating downgrades  – with Portugal following hot on the heels of Ireland, Spain and Greece as the latest country to have its deteriorating  public finances come under the spotlight.

Competitive currency devaluations continue with Venezuela significantly devaluing the bolivar in order to boost competitiveness. Chavez, like many international leaders, is adopting the classic short term panacea of a mismanaged nation – inflation of the currency.

Silver
Silver range traded between $18.72/oz and $18.82/oz overnight. Silver is currently trading at $18.78/oz, €12.91/oz and £11.62/oz.

Platinum Group Metals
Platinum is trading at $1,578/oz and palladium is currently trading at $431/oz. Rhodium is at $2,750/oz.