Cross Currency Table – (Bloomberg)

Gold fell $11.70 or 0.7% in New York yesterday and closed at $1,664.80/oz. Silver slipped to a low of $31.09 and finished with a loss of 1.66%.

Gold Spot $/oz, 60 Days, 30 Minutes – (Bloomberg)

For the month, the falls yesterday led to gold being 0.4% lower in dollar terms in January. It was also lower in euro terms but eked out strong gains against the pound and Japanese yen both of which saw falls on international markets.

On the week, while gold is lower today it looks set for a small weekly rise in dollar terms and by more in other currencies. It is currently 0.45% higher in dollar terms and 0.35% higher in sterling terms but has seen stronger gains in other paper currencies - 1.1% higher in euro terms, 1.9% higher in yen terms and 2% higher in Swiss franc terms.

While the euro has strengthened against the dollar and pushed the dollar index to its lowest level since the end of December – both currencies look vulnerable to further falls against gold in 2013.

Gold Spot $/oz, 5 Days, Tick – (Bloomberg)

A higher close this week may help the negative technical and overall sentiment towards gold due to the recent price weakness.

U.S. nonfarm payrolls are published at 1330 GMT and a negative number should see more safe haven gold buying as was seen after the poor GDP number this week.

The CME Group said it will add platinum and palladium options onto its Globex electronic platform starting towards the end of February. They intend to cater for the increasing investor interest in platinum group metals.

New research confirms that having gold in a portfolio acts as a currency hedge and will protect investors from currency volatility in emerging markets.

The World Gold Council, examined eight periods of “crisis conditions” and found returns from portfolios that included gold in hedging were 2.4% higher than investments lacking measures to counter exchange-rate risk. Gold beat currency hedges by 1%, according to the Council.

Economic growth in emerging markets, along with “aggressive” monetary policies in developed countries, led to increases in interest-rates disparities and more expensive exchange-rate hedging costs, they noted. 

The World Gold Council has long been at the forefront of providing excellent research showing gold’s importance as a hedge, diversification and store of wealth for investors and savers.

JPMorgan Sees Gold At $1,800 By Mid 2013 As South Africa “In Crisis” And “Escalating Instability” In Middle East  
J.P. Morgan Chase & Co. said gold will rise to $1,800 an ounce by the middle of 2013, with the mining industry in South Africa “in crisis,” according to Bloomberg.

South Africa, once the largest gold producer, faces industrial unrest, high wage inflation and adverse regulatory changes for local mines, Allan Cooke, an analyst at the bank, said in a report dated today.

Gold will get a boost from prospects of more stimuli from the U.S., Japan and Europe, the potential for escalating instability in the Middle East and low interest rates, according to the report.

Geopolitical risk from the Middle East and the risk of war between Israel and Syria and Iran remains seriously underestimated by market participants and will provide support for both oil and gold.

Only yesterday the crisis intensified after Israel stepped into the Syrian conflict by bombing the outskirts of Damascus. Russia condemned the attack and Syria has threatened retaliation.

Webinar on Gold and Silver in 2013
Dominic Frisby, Money Week’s gold expert and GoldCore's Head of Research, Mark O'Byrne conducted a one hour webinar on Wednesday which discussed the outlook for gold and silver in 2013 and beyond.

Central Bank Gold Buying May Lead To Higher Prices in 2013 – GoldCore Webinar Slide

Frisby and O’Byrne presented a series of interesting slides. Both remain bullish in the long term but were cautious about the short term – primarily due to the poor recent technical action.

The webinar was extremely well attended and question and answers were again increasingly popular. Some of the interesting and important questions posed to both Frisby and O’Byrne were

>> What is your opinion of the reasons for the German gold repatriation & why do you think it is going to take 7 years to do so?

>> What is your opinion regarding tungsten gold bars?

>> Do you believe the gold market is manipulated by bullion banks and central bankers who do not want to see gold going up?

>>  If metals are going so high why only recommend 5, 10, 15% allocation in portfolio?
Why not +50%?

The  webinar can be watched and listened to by registering to view the recording at this link

NEWS
Gold headed for weekly rise; US jobs data in focus - Reuters

Gold futures rise ahead of U.S. jobs data – Market Watch

COMMODITIES - Profit taking hits grains, gold; index up 3% in January – Reuters

LBMA, IGE urged to end Iran-Turkey Gold trade – Bullion Street

Gold Seen Countering Emerging Market Currency Risk - Bloomberg

COMMENTARY
Gold mitigates foreign-exchange risk when investing in emerging markets – World Gold Council

A Wager on Metal's Silver Lining – The Wall Street Journal

Forget the slowdown in the US – the UK is the real worry – Money Week

The 10 Minute Gold Standard: It’s Much Easier Than You Think - Forbes

Rush To Safety: Americans Buy Nearly Half a Billion Dollars Of Gold and Silver In January – 24H Gold

Video: Should You Buy Precious Metals? - CNBC

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-- Posted Friday, 1 February 2013 | Digg This Article