Friday, 1 July 2011
Gold Price Hurt by Haven Status as Europe Drives Confidence
The following table includes the correlation between gold and the most popular currency pairs over various timeframes. A value close to +1 indicates a strong positive relationship between gold and the pair, while a value close to -1 indicates a strong negative relationship. Colored values indicate week-to-week changes of over 30%.
Weekly Commentary: The Greek debt situation continued into its final weeks, largely driving risk sentiment in both the currencies and commodities markets. However, gold’s new-found status as a safe haven developed over the last month did not work out in its advantage. Investors largely expected the Greek situation to be resolved with passages of the confidence motion, 2nd budget agreement and further implementations details, funds flowed out of gold and safe haven currencies into higher yielding assets.
Despite the regained confidence in the Eurozone, traders look towards world economic health in the second half of 2011. A combination of additional weakness as the global economy struggles to recover and expectations of higher central banks to deal with inflation may spur dollar buying. This safe haven flow may further hurt the price of gold as US rates rise, adding additional demand for the haven currency.
Please note: Chart uses franc rate as CHFUSD to show safety correlation with gold.
Comex Gold Ends Lower on Better Investor Risk Appetite
Now that the Greek parliament has passed the very unpopular austerity measures the world market place is looking at other matters, such as some recent better economic data coming out of Japan earlier this week and some slightly better U.S. economic data Thursday. That also served to somewhat lift investor spirits. However, the Greek debt crisis has not just gone away and there are other European Union countries that have serious debt problems to address, too.
In an interesting aside, it was reported Thursday that Greece's central bank bought 1,000 ounces of gold in May.
The U.S. dollar index traded weaker again Thursday and that did limit the downside in the precious metals. The greenback bulls are fading badly. Some hawkish comments from European Central Bank president Trichet, suggesting another ECB interest rate hike forthcoming, helped to boost the Euro currency and pressure the dollar index Thursday. The dollar index remains in an overall technicallybearish posture, which is an underlying bullish factor for gold and silver.
Crude oil prices traded not far from unchanged levels Thursday. However, crude oil bulls this week have gained some fresh upside near-term technical momentum to begin to suggest that a market low is in place, as prices moved above $95.00 a barrel on Wednesday. If crude can continue to recover from this week's six-month low seen earlier this week, that would also be a bullish underlying factor for the metals.
The London P.M. gold fixing was $1,505.50 versus the previous P.M. fixing of $1,504.25.
Technically, August gold futures prices closed near the session low Thursday. Gold bulls still have the overall near-term technical advantage. Bulls' next near-term upside technical objective is to produce a close above strong technical resistance at $1,530.00. Bears' next near-term downside price objective is closing prices below solid technical support at this week's low of $1,490.80. First resistance is seen at Thursday's high of $1,514.80 and then at $1,520.00. First support is seen at $1,500.00 and then at Tuesday's low of $1,495.50. Wyckoff's Market Rating: 6.0.
July silver futures prices closed near mid-range Thursday. Prices are still in a four-week-old downtrend on the daily bar chart. The next downside price breakout objective for the bears is closing prices below solid technical support at this week's low of $33.38. Bulls' next upside price objective is producing a close above solid technical resistance at last week's high of $36.77 an ounce. First resistance is seen at Thursday's high of $35.14 and then at $35.42. Next support is seen at Thursday's low of $34.45 and then at $34.00. Wyckoff's Market Rating: 5.5.
July N.Y. copper closed up 545 points 426.40 cents Thursday. Prices closed nearer the session high and hit a fresh two-month high. Prices also closed at a bullish monthly high close Thursday. The weaker U.S. dollar index helped to boost copper today, as did some stronger economic data from Japan and the U.S. The bulls have fresh upside technical momentum. Copper bulls' next upside breakout objective is pushing and closing prices above solid technical resistance at 435.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 410.00 cents. First resistance is seen at today's high of 427.40 cents and then at 430.00 cents. First support is seen at 425.00 cents and then at 421.25 cents. Wyckoff's Market Rating: 6.5.
Source: http://news.yahoo.com/comex-gold-ends-lower-better-investor-risk-appetite-031017779.html
Thursday, 30 June 2011
Gold Price Steady at $1,510 on Weak Jobless Claims
Gold prices remain mired in a trading range as investors weigh the negative impact on the yellow metal of the end of the Fed’s second round of quantitative easing. Today, June 30, is the official end of QE2, a $600 billion asset purchase program designed to keep interest rates low and stimulate the economy.
On Wednesday, the gold price climbed $9.72 to $1,511.02 per ounce amid U.S. dollar weakness and widespread gains in commodities. The SPDR Gold Trust (GLD), a proxy for the price of gold, settled higher by $0.94 at $147.18 per share. Strength in the price of gold and the U.S. dollar’s slide were fueled by the approval of a $112 billion austerity package by the Greek parliament. Following the vote, the euro rose 0.5% to 1.4437 against the dollar and asset prices rose across the board.
Silver traded near unchanged Thursday after yesterday’s 2.8% bounce that took gold’s sister precious metal to just under $35 per ounce. Gold and silver equities continued their stretch of recent gains as the Philadelphia Gold & Silver Index (XAU) jumped 2.1% to 199.44. In doing so, the XAU extended its weekly gain to 3.9%, putting it on pace for its best week since a 4.6% climb from May 24-27. Notable advancers included Barrick Gold (ABX) and Kinross Gold (KGC), with gains of 2.7% and 2.3%, respectively.
The price of gold posted its largest single-day gain yesteday since a 0.6% rise on May 27. The fact that a relatively small gain was the largest in five weeks speaks to the substantial selling pressure present over the past month in the gold market. Despite the recent weakness, the gold price remains within 4.2% of its $1,577.40 all-time record high, reached on May 2.
Looking ahead, several market strategists see the gold price consolidating during the summer, prior to another leg higher in the fall. Barclays Capital analyst Yingxi Yu wrote in a note to clients that “There are still reasons to buy gold, but just not any new reason for now. Market participants are generally positive on gold, but it is a question whether now is the right time to enter the market given the volatility in risky assets such as equities and oil in particular.”
HSBC analyst James Steel commented that “The gold market may not have dropped enough to invite substantial emerging market and safe haven buying to emerge. Longer term, we remain bullish. The strength of the CHF (Swiss Franc) shows there is still plenty of nervous safe haven buying that could easily shift into gold.”
Heading into the July 4 holiday weekend, there are several upcoming data points on the financial calendar that could serve as catalysts for the gold price. In addition to the ongoing economic uncertainty in Greece and across Europe, a slew of data is set to be released in coming days. The Chicago Purchasing Managers Index (PMI), a key manufacturing gauge, will be released on Thursday and Friday brings the University of Michigan Consumer Sentiment, the ISM Index, and reports on construction spending and automobile sales.
If the economic reports paint a picture of further economic softening, the gold price is likely to remain well supported, while better than expected data could provide a headwind for the yellow metal.
Source: http://www.goldalert.com/2011/06/gold-price-steady-at-1510-on-weak-jobless-claims/
Gold Prices Dip on Manufacturing Data
Gold for August delivery was down $4 to $1,506.40 an ounce at the Comex division of the New York Mercantile Exchange. The gold price has traded as high as $1,514.80 and as low as $1,501.20 while the spot gold price was down $5.60, according to Kitco's gold index.
Silver prices were holding up better, down 2 cents to $34.74 an ounce while the U.S. dollar index was losing 0.43% at $74.32 and the euro was adding 0.58% against the dollar.
Gold and silver prices have had a volatile day. Gold had been treading water in early trading, but prices headed sharply lower after manufacturing activity in the Chicago area soared in June. Investors were more willing to place bets on riskier stocks and were putting safe haven assets on the back burner. The positive manufacturing reading was a positive for silver, as 50% of what's mined goes directly to the industrial sector.
"Gold still appears to be struggling for traction," says James Moore, research analyst at FastMarkets.com. "Failure to conquer resistance around $1510-12 could potentially lead to a test of chart support around $1485."
A weaker U.S. dollar, which has come under pressure as the euro rallied and Greece secured its next round of bailout money, provided some support for the precious metals.
Despite short-term weakness, some experts are expecting another rally in gold and silver prices during August and September. In 2010, gold prices rallied 11.7% and silver popped 21% during the same time frame. "Typically you see a very big move in the price of gold," says Brian Hicks, co-manager of the U.S. Global Investors Global Resources Fund," we think that will be that case this year as well."
Hicks predicts that gold will be able to break out of its wait-and-see pattern and move solidly above $1,500 and that silver could rally past $40 an ounce but stay below its recent high of $49.82. "Obviously there was a lot of technical damage in the price of silver and that needs to be repaired and eventually we think that will happen."
Gold's appeal as a safe haven buy has diminished as of late. John Chambers, managing director with Standard & Poor's said in an interview with Reuters, that the U.S. credit rating would be slashed to a "D" if it misses an interest payment when the government runs out of cash on August 4th. "D is surprising," says Hicks, "if that were to actually happen then I think you would see a material move in the price of gold as well as silver, but I think the Street is taking a wait-and-see approach."
Gold mining stocks were mixed. Barrick Gold(ABX_) was flat at $44.99 while Newmont Mining(NEM_) was up 0.73% at $53.91. Other gold stocks, Goldcorp(GG_) andAngloGold Ashanti(AU_)were trading at $48.14 and $42.07, respectively.
Source: http://www.thestreet.com/story/11171637/1/gold-prices-dip-on-manufacturing-data.html?cm_ven=RSSFeed
Monday, 30 May 2011
Gold Weekly Fundamental Analysis for May 30, 2011 – June 03, 2011
Gold was steady the entire week above $1,500 areas and rallied to the highest in three weeks sustaining most of its gains on haven demand amid the deepening debt crisis in the euro area and the outlook for a slowing global recovery.
This week, the sentiment was very fragile and mixed amid choppy trading. The debt crisis surely had the lion’s share and the weak U.S. fundamentals were further downside pressure and to the dollar were merely added salt to injury.
Investors started their week with reaction to Fitch’s move on Greece’s debt rating as it was lowered by three notches. Standard & Poor’s downgraded Italy’s credit rating outlook to “negative” and then again Belgium saw the same fate but from Fitch this time with downgraded outlook from stable to “negative”.
Fears continued to mount with speculation that Greece might call an early election which the government denied. The Greek Cabinet passed new austerity measures and accelerated asset-sale plans to ensure its commitment to targets and try to avoid debt restructuring.
This was the first part of the equation, as the debt fears kept gold buoyed with upside support. On the other hand, fears over slowing global recovery was swinging between highs and lows with the inflow of data.
The data seen were generally downbeat, and especially from the United States this week, which fueled risk aversion at times and dollar gains, which in most times gold resisted. Nevertheless, to the end of the week the G8 comments that the global recovery is ongoing and gaining momentum which will offset the debt crisis eased the woes and heavily pressured the dollar to soften, as investors saw the U.S. data only weak on the dollar amid a steady monetary policy outlook.
As we start a new week, gold remains volatile and will be subject to heavy fluctuations alongside the mixed sentiment, yet we can surely see the upside support for the metal prevailing from the high uncertainty.
Gold’s past two weeks of gains somehow offset the metal’s sensitivity to the dollar and revived some of its appeal as a haven once again and accordingly it will be poised for more gains this week as the focus will remain on the euro area’s debt crisis with little data due for release and on the U.S. recovery with heavy data on queue all week leading to the infamous jobs report on Friday.
India: Gold falls to Rs 22,820 on global cues, silver slips by Rs 350
Traders said sentiments turned weak after both the precious metals recorded fresh losses in the global markets along with lack of buying interest at prevailing high levels in the local markets.
Gold in global markets, which normally sets a price trend on the domestic front, eased by USD 1.40 to USD 1,535.10 an ounce, while silver shed 0.21 per cent to Rs USD 37.88 an ounce.
On the domestic front, silver ready fell by Rs 350 to Rs 57,250 per kg and weekly-based delivery declined by Rs 335 to Rs 57,250 per kg.
Silver coins followed suit and declined by Rs 1,000 to Rs 65,000 for buying and Rs 66,000 for selling of 100 pieces.
In line with a general weakening trend, the gold of 99.9 and 99.5 per cent purity declined by Rs 45 each to Rs 22,820 and Rs 22,700 per 10 grams, respectively.
However, sovereigns remained steady at Rs 18,700 per piece of eight grams.
Gold Price Set to Challenge Record Highs?
Not to be outdone, silver surged higher alongside the gold price. On Friday, gold’s sister precious metal climbed $0.72, or 1.9%, to $37.97 per ounce. In doing so, the silver price posted a weekly gain of $2.90, or 8.3%, marking its best week since April 18-22. Thus far in 2011, silver has surged 22.7%, however, it remains 23.8% below its 31-year high of $49.82 per ounce achieved earlier this month.
Gold and silver shares powered higher alongside the price of gold and silver, as the Philadelphia Gold & Silver Index advanced 1.5% to 208.47. In doing so, the XAU posted its best week since April 4-8. However, the XAU remains in negative territory by 8% this year. Despite record gold prices, the shares of gold producers continue to lag the metal as multiple compression has led to lagging performance.
While the gold price advanced for the second straight week, sentiment toward the yellow metal has only modestly reflected this rebound. Dennis Gartman, long-time commodities investor and author of The Gartman Letter, wrote on Friday that “there is a decided lack of ‘frenzy’ in the gold market at present, and indeed, we find it passing strange that with gold only a very few dollars from its all time highs there is very little if any speculative enthusiasm.”
Gartman noted that MarketVane’s Bullish Consensus for the gold price dropped 2 points to 77% from 79% over the past several days, well below what he would expect given the fact that the gold price is within a few percent of its all-time high. “Bullish enthusiasm is high,” Gartman acknowledged, “but it is not rising and certainly it is not at ‘nosebleed’ levels consistent with previous interim peaks” in the price of gold.
From a contrarian perspective, the absence of excessive positive sentiment toward the gold price is an encouraging sign. “We remain bullish and it shall be but a matter of time… perhaps even today…” Gartman wrote on Friday morning, “that the recent highs of $1533-1535 in US dollar terms shall be taken out to the upside.” Gartman did not provide a longer-term gold price target, however.
Bill Fleckenstein, another long-time gold price bull and noted market pundit, echoed similar comments to those of Gartman this past week. On Minyanville.com, Fleckenstein contended that a “great set up” has developed for gold stocks. The sector is “sold out,” according to Fleckenstein.
Fleckenstein also pointed to several contrarian indicators that suggest the sector is ripe for a rally. “GDX has low open interest, as do the Rydex gold funds. Futures contracts too have seen a big liquidation. Lots of people are set for gold and the miners to do poorly as QE2 ends, but gold is not just bought by Americans and hence we could see a rally that might catch people by surprise and see gold stocks do quite well.”
In addition to the bullish technical setup for the gold price and gold stocks, Fleckenstein pointed to slowing economic activity in the U.S., which will pressure the Federal Reserve to maintain its slew of ultra loose monetary policies. This past week, first quarter GDP, jobless claims, and pending home sales each came in worse than economists were expecting.
Coupled with the ongoing sovereign debt issues in Greece, where policymakers continue to argue over additional bailout funds, austerity measures, and a possible debt restructuring, Fleckenstein asserted that many “friendly catalysts” for the gold price abound.
Source: http://www.goldalert.com/2011/05/gold-price-set-to-challenge-record-highs/
Nepal: Gold price soars to Rs. 37,125 per 10 gm to set new record high
Following the rise in price of gold in the international market, the price has also increased by Rs. 125 per 10 gm in the domestic bullion market to break the previous record of Rs. 37,000 per 10 gm on Thursday last week.
The price of the yellow metal has increased to US$ 1,536 per ounce in the international market on Sunday.
According to the Nepal Gold and Silver Dealers' Association (NGSDA), strong dollar and rise in oil prices in the international market has contributed to the rise in the price of the precious metal in the domestic market.
Though the price of gold witnessed slight fluctuation last Friday to settle Rs. 36,950, it soared up by Rs. 175 per 10 gm on Sunday this week.
Source: http://www.nepalnews.com/archive/2011/may/may30/news10.php
Sunday, 22 May 2011
Gold Weekly Fundamental Analysis for May 23-27, 2011
Gold recovered most of the losses endured in the week and on Friday continued to trade with high volatility with the strong return of the dollar on rising risk aversion and fears over the outlook for the recovery.
We saw the metal surrender its shiny appeal amid the huge profit taking wave and the commodity selloff that pressured the metal below $1500 areas once again and jeopardized the inevitable faith investors had in the metal and its bullishness.
Fundamentally now gold lacks the compass, where the ongoing market volatility and high uncertainty and fears over the recovery and surely supportive for gold gains, nevertheless, the metal is trending on another support and its inverse relationship to the dollar, which is keeping the gains contained yet at the same time losses limited!
At the end of last week on Friday, the dollar rallied and global markets moved strongly lower after Germany’s Bundesbank said the German economy might lose some of the positive momentum and the recovery might slow following what they called an “explosive” start to the year.
That was the spark for what we are expecting for the coming week for gold. If the metal is finally going to break though the rout seen in the past two weeks mainly and the tight trading range and fluctuations, gold must take a side this week as the sentiment is likely to be dominated by the outlook for the global recovery.
If the fear prevails as the strong voice in the market, gold must pick a winning side, either rally on needed haven demand, or simply surrender to the dollar that will likely be the dominant winner. While if the fears eased and the dollar corrected the gains, then the metal is also poised to move to the upside, yet in this case will be merely inline with the ongoing relationship for the past period and will not bring anything new for gold.
The bullion’s long term outlook is still steadily and strongly bullish, yet the metal has lost its path on the way there and the lack of strong momentum and the fear of entering the market on gold are keeping the metal sidelined amid high volatility and uncertainty across global financial markets.
Gold Technical Analysis for May 23, 2011
The gold markets had an extremely bullish day on Friday, and have confirmed the $1,480-$1,500 support level. As the trend is up, we are only buying or flat in this market. It appears that Friday shows that the market is ready to rise again. The market was up $22 an ounce towards the closing, showing real strength and conviction in the gold markets.
Source: http://www.commoditiesmansion.com/technical-analysis/gold-technical-analysis-for-may-23-2011/
Gold Daily Fundamental Analysis for May 23, 2011
Gold continues to be pressured by the volatile market sentiment and the shaky conditions across commodities markets, which accordingly is holding gold a prisoner to the dollar.
On Friday, gold marginally moved higher of the day to only surrender the losses on a strong dollar comeback and amid the lack of data, where investors turned pessimistic over the state of the global recovery, fueled by Budesbank’s monthly report that saw Germany’s growth slowing into the coming quarters after a strong start.
The German projections for slowing expansion was the last straw, where the nation has been enjoying a steady recovery and is leading the expansion in the euro area as well, and shall the economy slow, it is an added downbeat signal on a slowing global recovery.
Fears over the outlook continue to provide the dollar with the bullish momentum which surged strongly on Friday on the back of intensified risk aversion amid the bleak outlook. Gold is still trading under a dollar realm and although the fundamentals are more supportive for haven demand on the metal its vulnerability to the dollar and liquidations on the heavy selling are pressuring the metal.
The sentiment with the start of the week on Monday will be still concentrated on growth especially with Germany and the United States to release the second estimate for the first quarter GDP.
Saturday, 21 May 2011
Mixed Outlook For Gold Next Week
Silver prices remain volatile, but the tone toward the metal remains negative, especially as recent economic data suggests a possible slowing of industrial demand.
June gold futures on the Comex division of the New York Mercantile Exchange settled at $1,508.90 an ounce, up 1.024% on the week. July silver futures settled at $35.087 an ounce up 0.211% on the week.
In the Kitco News Gold Survey, out of 34 participants, 19 responded this week. Of those 19 participants, eight see prices up, while eight see prices down and three see prices sideways or unchanged. Market participants include bullion dealers, investment banks, futures traders and technical chart analysts.
Following the recent volatility in prices, several market watchers said they’re looking for gold prices to consolidate and try to establish a new price range before deciding on the next way to move. Several market watchers said gold could trade between $1,480 and $1,520.
Technical analysts at Barclays Capital said if gold breaks support at $1,460, it may drop to $1,410, an area they said would represent a buying opportunity. They are near-term bearish on silver. If silver falls under $32.30, then prices could tumble to the $29.40-$30 region.
Ira Epstein, director of the Ira Epstein division of The Linn Group, said in the near-term he believes the negative seasonal tendency for metals to slip will take over. Epstein is a veteran of the markets and has followed the historical tendencies for metals.
“The month of June is not often friendly to gold or silver prices according to historical data provided by the Moore Research Center, Inc. Fall months are friendly in bullish environment years, due in part to demand for material stock for jewelry sales that begin pick up for the December holiday season,” Epstein said.
Epstein said the inflation theme has begun to stall out, noting the drop in the CRB Index, an index that tracks certain commodity prices.
“I remain in the bear camp (for gold) until prices turn around,” he said.
Later this summer he said it’s possible he might change his mind, but “it appears that right now the market bears remain in control.”
Those who see gold prices rising next week cite renewed concerns in Europe. The ongoing sovereign debt issues with Greece reignited when comments from the European Central Bank and the International Monetary Fund suggested that without further austerity measures and sale of assets by Greece, the ability of Greece to be able to repay debt soon coming due comes into question.
Furthermore, several market watchers said they are keeping an eye on the outcome of this weekend’s regional Spanish elections, which come ahead of next year’s national elections.
Media reports said it’s expected the ruling Socialist party will lose, with some polls showing they are likely to lose nine of the 13 regions and some key cities like Barcelona.
Marc Chandler, global head of currency strategy at Brown Brothers Harriman, said the election is important because regions control spending on health care and education and account for half of government employees. They have an outstanding debt of 115 billion euros, about US$165 billion.
Chandler said there’s a risk that once new governments come into power they may find the deficit is much greater than expected. That happened in Spain’s largest region Catalonia, which said its deficit was really 60% more than what the previous administration said.
“It is thought that ahead of the regional elections, the existing governments have little incentive to implement the agreed upon austerity measures. The new regional governments will be under pressure to take most of this year’s fiscal measures in the remaining months of the year,” he said.
Tom Pawlicki, metals analyst at MFGlobal, said he thinks overall that gold prices are expected to maintain a slightly higher trend over the next one to two weeks, provided support from the 50-day moving average in gold at $1,470 is held.
News this week from the World Gold Council gives underlying support. The industry group said in its first quarter demand trends that total demand rose by 4.6% quarter-over-quarter and 10.5% year-over-year, while total supplies fell 23.0% quarter-over-quarter and 4.4% year-over-year.
“We believe (it) will offer a generally bullish impact on gold prices. Forecasts on Chinese demand and official sector buying tipped the balance in favor of higher gold prices,” Pawlicki said.
The report showed that China surpassed India as the largest consumer of gold, which several analysts said will offer a floor for gold prices.
Next week brings durable goods orders and the revision to first quarter U.S. gross domestic product. MarketWatch expects a drop in April durable goods orders of 3%, versus the 4.1% rise in March. They said the GDP is expected to be revised slightly higher, to 2.2%, from the initial reading of 1.8%.
Pawlicki said some pressure in gold could come from weakening of industrial demand due to economic weakness and from a potential resumption of the commodity liquidation.
“There is still a tug-of-war taking place between those who believe the commodity trade has peaked in front of the end of QE2, and those who believe it is just a correction,” he said, adding that he is the later camp.
Source: http://blogs.forbes.com/kitconews/2011/05/20/metals-outlook-mixed-outlook-for-gold-next-week/
Gold Price Hits New Euro-High, Adds 1.1% for Week vs. Dollar, as Stock Markets Fall, Silver Stalls
Falling as low as $1486.80 per ounce by 10am New York time, the Gold Price then shot to a new session high of $1515.75 by early afternoon and ended the day with a gain of 1.2%, up by 1.1% on the week.
Silver Prices surged as high as $35.56 in Asian trade before falling back to $34.21 in New York. Silver also then bounced back higher in late trade, but it ended with a gain of just 0.5% on the day, barely 0.1% higher for the week.
Treasuries rose as the Dow, Nasdaq, and S&P fell on poor earnings reports, with the US stock indices losing around 1% for the week.
Oil climbed higher in late trade and ended near $100 a barrel on short covering heading into the weekend.
The US Dollar index rose as the Euro fell after Fitch downgraded Greece’s credit rating below investment grade.
The Gold Price for Euro buyers rose to €1070 finishing Friday at a new all-time high weekly close, just shy of its all-time daily peak made in late Dec. 2010.
Platinum gained $1.50 to $1763, and copper gained 7 cents to about $4.12.
Gold Mining and silver equities fell about 2% by midmorning in New York, but they then climbed to see over 1% gains by midday and remained near that level for the rest of the day, closing the week just over 2% stronger.
There was no US economic data on Friday, but Canadian Retail Sales and Consumer-Price inflation both came in weaker than analysts forecast.
Canada's stock market is closed on Monday for Victoria Day. Between now and next week's long Memorial Day weekend, US economic highlights will include New Home Sales on Tuesday, Durable Goods Orders on Wednesday, GDP and Initial Jobless Claims on Thursday, and Personal Income and Spending, Core PCE Prices, Michigan Sentiment, and Pending Home Sales on Friday.
Source: http://goldnews.bullionvault.com/gold_price_052120111
Australia’s First-Quarter Gold Output Rises 6%, Surbiton Says
Output in the world’s second-biggest gold-producing nation rose 4 metric tons from a year earlier to 65 tons in the three months to March 31, Sandra Close, director at Melbourne-based Surbiton Associates Pty, said in an e-mailed statement.
Two cyclones hit Western Australia state in January and February, while the eastern states battled rains and wind from cyclones Anthony and Yasi, blocking access roads to many mines.
“The abnormally wet weather impacted both open-cut and underground operations,” Close said. Mines had “performed well under the circumstances,” she said.
Gold reached a record on May 2 as investors sought to protect their wealth against accelerating inflation and concern about the debt positions of European nations. Citigroup Inc. raised its 2011 gold price forecast to $1,443 an ounce from $1,416 an ounce, analyst Jon Bergtheil said in a report dated May 20.
The Superpit, a venture between Newmont Mining Corp. (NEM) and Barrick Gold Corp. (ABX) located 550 kilometers (342 miles) east of Perth, was Australia’s largest producer during the quarter with 200,000 ounces, Surbiton said.
Gold May Gain as Speculation on Pace of Fed’s Tightening Increases Demand
Fed Bank of Chicago President Charles Evans yesterday said improvements in the economy, labor market and the outlook for inflation aren’t sufficient for the central bank to begin reducing its record monetary stimulus. Gold pared some of its gains after the dollar climbed against six major currencies. Gold typically moves counter to the greenback, which earlier today fell to a one-week low.
Recent economic data may allow “policy makers some time before turning hawkish and admitting future liquidity curbs,” Andrey Kryuchenkov, an analyst at VTB Capital in London, said today in a report. “This means limited downside in gold.”
Gold for June delivery rose $2.70, or 0.2 percent, to $1,495.10 an ounce by 7:59 a.m. on the Comex in New York. Prices earlier gained as much as 0.8 percent and are little changed this week. Immediate-delivery gold was 0.2 percent higher at $1,495.60 in London.
Twelve of 19 traders, investors and analysts surveyed by Bloomberg, or 63 percent, said bullion will rise next week. Three predicted lower prices and four were neutral.
Concern about faster inflation, Europe’s debt crisis, a weakening dollar and fighting in Libya boosted gold to a record $1,577.40 on May 2. Prices are up 5.2 percent in 2011 after climbing the past 10 years, the longest run of gains in at least nine decades in London.
Gold Prices
This week, gold prices “held in U.S. dollar terms; it has held in euro, yen and sterling terms and we are impressed by that holding,” said Dennis Gartman, an economist and the editor of the Suffolk, Virginia-based Gartman Letter. He said he’s adding to his gold positions.
Prime Minister George Papandreou is finalizing the fifth round of deficit cuts to comply with an international bailout as economists, including Nouriel Roubini, say he’ll fail to prevent Greece from becoming the first country to restructure its debt in the euro region.
“U.S. dollar weakness and uncertainty surrounding Greece’s debt situation were supports,” Mark Pervan, head of commodity research with ANZ Banking Group Ltd., wrote in a note today.
Silver for July delivery fell 0.1 percent to $34.885 an ounce in New York. Palladium for June delivery was up 0.1 percent at $729 an ounce. Platinum for July delivery was little changed at $1,769.60 an ounce.
