LIVE Gold Prices $  | E-Mail Subscriptions | Update GoldSeek | GoldSeek Radio 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

GoldSeek.com to Launch New Website
By: GoldSeek.com

Is Gold Price Action Warning Of Imminent Monetary Collapse Part 2?
By: Hubert Moolman

Gold and Silver Are Just Getting Started
By: Frank Holmes, US Funds

Silver Makes High Wave Candle at Target – Here’s What to Expect…
By: Clive Maund

Gold Blows Through Upside Resistance - The Chase Is On
By: Avi Gilburt

U.S. Mint To Reduce Gold & Silver Eagle Production Over The Next 12-18 Months
By: Steve St. Angelo, SRSrocco Report

Gold's sharp rise throws Financial Times into an erroneous sulk
By: Chris Powell, GATA

Precious Metals Update Video: Gold's unusual strength
By: Ira Epstein

Asian Metals Market Update: July-29-2020
By: Chintan Karnani, Insignia Consultants

Gold's rise is a 'mystery' because journalism always fails to pursue it
By: Chris Powell, GATA

 
Search

GoldSeek Web

 
Euro-Gold Spikes Higher as ECB Stays "Accommodative", Chinese New Year Gold Demand "More Important" than India's Diwali



By: Adrian Ash, BullionVault


-- Posted Thursday, 3 February 2011 | | Source: GoldSeek.com

London Gold Market Report

 

THE PRICE OF GOLD in US Dollars again retreated towards this week's lows beneath $1330 per ounce on Thursday in London, falling back as world stock markets and commodities both slipped.

Major-economy goverment bonds ticked higher. Silver prices dropped back towards last week's finish at $28 per ounce.
 
"The one thing to remember about silver is its very high correlation with gold," says Reuters Technical's Phil Smith, "better than 90% in fact, and the long-term gold charts are quite bearish at the moment."

After sliding more than 3% for the week so far, in contrast, the gold price in Euros spiked higher today after the European Central Bank held its interest rates at record lows, and ECB chief Jean-Claude Trichet gave a "dovish" forecast in his monthly press conference.

"We continue to see evidence of short-term upward pressure on overall inflation," said Trichet, blaming energy and food prices, and failing to promise the "vigilance" on inflation which some analysts had expected.

The Euro dropped 1.5¢ on Trichet's "accommodative policy stance", falling towards 1-week lows near $1.36.

French, German and Italian savers looking to buy gold saw it jump to €31,400 per kilo.

The gold price in British Pounds meantime rallied from new four-month lows at £816 per ounce.

"Inflation is in the end not a stimulus for growth and employment. Long term it has a negative influence," says Helmut Schlesinger, former president of Germany's Bundesbank, in an interview with the BBC World Service.

"Frankly speaking, the common source [of the surge in energy and food prices] is a monetary phenomenon...[caused by] the policy of central banks."

Over in Asia on Thursday, where the Shanghai and Hong Kong gold markets were closed for the Lunar New Year, "China is on the fast track to replace India as the largest physical [gold] consumer," reckons UBS precious metals strategist Edel Tully, speaking to the Financial Times.

"The Chinese New Year is now significantly more important than Diwali in volume terms."

Analysis by BullionVault also shows seasonal price-humps in the gold market steadily moving from October to February since China began liberalizing private gold buying a decade ago.

"The seasonality around Chinese new year is something that we've seen in the last two to three years," said a senior trader in Asia.

"This year the demand may actually also carry on after Chinese New Year," says a Chinese trader quoted by the paper.

"Demand is unbelievable. The size of the orders is enormous," says another, estimating that gold bullion imports to China – the world's No.1 gold-mining producer – jumped to 200 tonnes in the last 3 months.

Gold bullion imports in India, currently the world's No.1 consumer market, rose 18% last month from Jan. 2010 to hit 40 tonnes, according to early estimates from the Bombay Bullion Association.

Ahead of this month's wedding season, "Buying is moderate today," the Economic Times of India quotes a Mumbai bank dealer. But premiums above benchmark London gold prices held "above $2 an ounce," he adds.

"We are getting supplies with a lag of 10 days."

Back in Europe on Thursday, retail sales across the 350-million citizen Eurozone fell 0.9% in Dec. compared with Christmas 2009, new data showed today.

Germany's service-sector, in contrast, expanded at the fastest pace in almost 5 years.

Political leaders from the 17-nation single currency union meet on Friday in Brussels to agree the funding process for the Eurozone's €440 billion government-debt "stability" mechanism.

"We are desperately waiting for the [US] Non-Farm Payrolls on Friday," says Swiss refiner MKS's Finance division, "hoping that they will spice up the gold market a little."

Following the surprise rise in the private-sector ADP Payrolls report, Jan.'s official US jobs data "could be quite negative for the precious metal, should the numbers turn out to be positive," MKS reckons.

 

Adrian Ash

 

Formerly City correspondent for The Daily Reckoning in London and head of editorial at the UK's leading financial advisory for private investors, Adrian Ash is the editor of Gold News and head of research at BullionVault – winner of the Queen's Award for Enterprise Innovation, 2009 and now backed by the World Gold Council market-development and research body – where you can buy gold today vaulted in Zurich on $3 spreads and 0.8% dealing fees.

 

(c) BullionVault 2011

 

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.


-- Posted Thursday, 3 February 2011 | Digg This Article | Source: GoldSeek.com





 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2019



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer


Map

The views contained here may not represent the views of GoldSeek.com, Gold Seek LLC, its affiliates or advertisers. GoldSeek.com, Gold Seek LLC makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, Gold Seek LLC, is strictly prohibited. In no event shall GoldSeek.com, Gold Seek LLC or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.