-- Posted Tuesday, 20 March 2012 | | Disqus
New York closed at $1,662.70 yesterday. Asia pulled it back to $1,656.50 ahead of London' opening. London opened with the euro at €1: $1.3136. The Fix was set at $1,648.50 and in the euro at €1,248.20 while the euro stood at €1: $1.3204.
Ahead of New York’s opening it stood at $1,644.25 and in the euro €1,267.64 while the euro was at €1: $1.3175.
Silver held again at $32.65 in Asia. Ahead of New York’s opening it stood at $32.15.
Gold (very short-term)
Gold should again consolidate around current levels, in line with euro moves, in New York today.
Silver (very short-term)
Silver should again consolidate around current levels, in line with euro moves, in New York today.
Price Drivers
The proposed doubling of import duties on gold are an attempt to dissuade Indians from buying gold. But Indians are unlikely to just bow their heads in submission. We mentioned that smuggling would reappear after it fell away in 1991. We also expect the volumes done at the high profiles gold outlets will drop but the low profile distributors whose record keeping is not particularly good to see a boost in their turnover. Indians have long been users of cash and not credit the world over, so poor record keeping understating turnovers is already endemic. Corruption among government officials and bureaucrats and their invasive nature, has, over the generations worn away any sense of national duty to support the government in its revenue gathering. While the Greek wealthy may be averse to paying taxes, Indians can become positively allergic to it.
So when it comes to what Indians consider real money [that has looked after them so well over the last seven years and more, we have no doubt that such an increase in duty will cause only a ‘pause’ in demand for gold while adjustments to gold buying are made by the Indian investor. In a country where the measurement of gold buying has always been an inaccurate affair we expect that banks and large gold distributors and retailors will feel the pinch, as smugglers and smaller outlets take turnover from them. Likewise the measurement of gold imports will also see an increase in its inaccuracies. To follow our regular Indian and Chinese gold market sections, subscribe to our newsletter at www.GoldForecaster.com .
Meanwhile China is seeing a 7% hike in petrol prices today. This certainly tells the Chinese people inflation is not dead, not matter how it is presented. Such price hikes are incentives to buy gold and quite rightly as gold as well as oil does reflect the value of money better than anything else. China’s growth is such that demand for gold will keep rising. This week has seen a rise in Chinese demand.
Regards,
Julian D.W. Phillips for the Gold & Silver Forecasters
Global Gold Price (1 ounce) |
| Today | 1 day ago |
Franc | Sf1,504.00 | Sf1,520.51 |
US | $1,644.25 | $1,646.55 |
EU | 1,248.20 | €1,259.64 |
India | Rs.82,861.98 | Rs.82,632.11 |
-- Posted Tuesday, 20 March 2012 | Digg This Article
| Source: GoldSeek.com
