Today’s AM fix was USD 1,311.00, EUR 942.08 and GBP 772.54 per ounce.
Yesterday’s AM fix was USD 1,308.50, EUR 939.61 and GBP 772.20 per ounce.
Gold fell $2.70 or 0.21% yesterday to $1,307.80/oz. Silver slipped $0.05 or 0.25% to $19.56/oz.
Gold is trading in a very tight trading range above $1,310/oz, with geopolitical risk from Ukraine driving the safe haven demand.
Technically, the gold price would be expected to break out at some point but the direction of the breakout is unclear. A breakout to the upside would have to clear $1,331/oz and then trade above $1,392/oz, towards the psychologically important $1,400/oz level.
Dave Toth, the director of technical research at futures brokerage RJ O’Brien and Associates in Chicago, has referred to this price pattern as “ranges within ranges” since the current price is in the mid-range of the price range over the last month and this latest month price range is itself in the middle of the price range over the last year.
Bangladesh Being Used As Transit Point for Gold Smuggling into India
The Financial Express of Dhaka, Bangladesh, today reports on a huge increase in customs seizures of smuggled gold into Bangladesh over the last year.
Last March, 107kg of gold was seized by officials at the international airport in Chittagong. Then more recently, 106kg was impounded at the international airport of the capital city Dhaka. The biggest seizure, however, was in July last year, at the same airport in Dhaka when 124kg of smuggled gold was discovered.
The National Board of Revenue have compiled statistics showing that while only 25kg of smuggled gold was seized in 2012 in Bangladesh, this rose to 520 kgs last year. Similar figures for the first three months of this year hit 220kg just from these two international airports.
Most legal gold arriving into Bangladesh comes from the Middle East, Singapore or Malaysia, and also via remittances from Bangladeshi immigrants. Since the import tax on gold into Bangladesh is very low, officials believe that the huge rise in smuggling is mainly is because Bangladesh is being used as a transit point for gold smuggling into neighbouring India where the import tax is currently running at more than 11%, and where there is an insatiable unfulfilled demand for gold.
Indeed, those arrested for gold smuggling into Dhaka and Chittagong airports have confirmed that the final destination is India and officials say that multiple international criminal groups are involved. Once the gold comes into Bangladesh it is transported back into India in smaller amounts via the numerous border crossings.
Bangladeshi law enforcement officials say that the smuggling operations are meticulously planned and they suspect that some corrupt staff from the Civil Aviation Authority and customs agencies may be involved, since otherwise the smuggling operations would be very difficult to execute. This is why they are viewing the smuggling as a potential national security issue.
This elaborate network of gold smuggling operations into Bangladesh and India shows yet again that in the Middle East, South Asia and East Asia, gold is not a ‘barbarous relic’, and is not ‘tradition’, it is in fact something much more fundamental, money.