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Gold’s London AM fix this morning was USD
1,727.00, EUR 1,302.22, and GBP 1,093.17 per ounce.
Friday's AM fix was USD 1,715.50, EUR 1,295.21, and GBP
1,084.25 per ounce.
Cross Currency Table – (Bloomberg)
Gold opened in Asia nearly $13 higher at $1,734.90/oz (after closing at $1,719.60 on Friday) prior to giving
up those gains and trading back near Friday's close at $1,720/oz in early Asian trade. It then gradually rose
back to challenge the $1,734/oz level and is
currently in the middle of the range between $1,720 and $1,735 (see chart
below).
Traders in Hong Kong say that the Chinese continue to
buy gold on any weakness. Bullion buying from China and the rest of
Asia (more below) may have led to the spike higher at the open in Asia.
Risk aversion has increased and stock markets have
risen after Greece’s parliament finally approved the austerity bill to
secure a second set of loans from the IMF and EU. The move is likely to
provide a temporary respite and stave off default and bankruptcy for a while
longer.
The debt deal and austerity measures were met with
serious violence in the streets of Athens and elsewhere in the country, as it
is deeply unpopular with the public and with much of the body politic.
The EU plans to meet Wednesday to give the final seal
of approval on the 130 billion euro bailout.
Gold fell by nearly 0.4% last week – its second
marginal weekly fall. This is negative technically but healthy for the gold
market as gold appears to be consolidating after the sharp 20% gains seen in
January.
Gold Spot $/oz – 2 Days
(Bloomberg)
"The Chinese guys are still buying. Whenever
there is a dip in prices, they will buy. There's no change in their
attitude," said a physical dealer in Hong Kong, who trades gold bars.
"They are still buying today, because I think the downside is limited
for the time being. Sentiment has improved a little bit.’’
Market focus tends to be almost solely on Chinese and
Indian demand but demand is broad based throughout increasingly important
Asian gold markets. Demand for gold remains robust in most Asian countries
where consumers are buying gold as a store of wealth due to concerns about
their local paper currency.
This phenomenon is happening throughout Asia including
in Malaysia, Indonesia, Thailand and Vietnam and other large Asian countries
(see news below regarding demand for gold by investors in Thailand).
AFP have a very interesting article on Vietnamese
‘gold fever’ which recounts how “stashing gold at
home rather than having cash in the bank is a generations-old habit in
communist Vietnam”.
And old habits are dying hard even if an ounce of gold
bullion can now cost up to US $100 more in Hanoi than anywhere else in the
world due to government meddling in the gold market.
AFP quote 60-year-old retiree
Truong Van Hue “I still like to keep my savings in gold. It's safe for
retired people like me. I can sell the gold any time,
anywhere, when I need cash,” he told AFP.
Although the treasure has long been perceived as a safe
haven, the recent gold rush has alarmed Vietnam's government, which is faced
with an 18 percent inflation rate and an unstable national currency, the
dong.
Vietnam's love of the yellow metal is centuries-old,
rooted in a history of strife, warfare and want. "Empires may fall,
currencies may change... gold will always survive," said
sociologist Vu Duc Vuong.
For breaking news and commentary on financial markets
and gold, follow us on Twitter.
OTHER NEWS
(Bloomberg) -- Gold Traders Increase Bets on Price Rise, CFTC Data
Shows
Hedge-fund managers and other large speculators increased their net-long
position in New York gold futures in the week ended Feb. 7, according to U.S.
Commodity Futures Trading Commission data.
Speculative long positions, or bets prices will rise, outnumbered short positions by 177,507 contracts on
the Comex division of the New York Mercantile
Exchange, the Washington-based commission said in its Commitments of Traders
report. Net-long positions rose by 6,148 contracts, or 4 percent, from a week
earlier.
Gold futures fell this week,
dropping 0.9 percent to $1,725.30 a troy ounce at today's close.
Miners, producers, jewelers and other commercial users
were net-short 221,072 contracts, an increase of 11,210 contracts, or 5
percent, from the previous week.
(Bloomberg) -- Silver Traders Increase Bets on Price Rise,
CFTC Data Shows
Hedge-fund managers and other large speculators increased their net-long
position in New York silver futures in the week ended Feb. 7, according to
U.S. Commodity Futures Trading Commission data.
Speculative long positions, or bets prices will rise, outnumbered short positions by 23,587 contracts on
the Comex division of the New York Mercantile
Exchange, the Washington-based commission said in its Commitments of Traders
report. Net-long positions rose by 4,496 contracts, or 24 percent, from a
week earlier.
Silver futures fell this week,
dropping 0.4 percent to $33.60 a troy ounce at today's close. Miners,
producers, jewelers and other commercial users were net-short 34,650
contracts, an increase of 5,921 contracts, or 21 percent, from the previous
week.
(Bloomberg) -- Speculators Lift Wagers to Highest Since
September: Commodities
Hedge funds increased bets on rising commodity prices to the highest since
September on mounting confidence that growth in the U.S. will strengthen
demand.
Money managers boosted their combined net-long
positions across 18 U.S. futures and options by 13 percent to 929,199
contracts in the week ended Feb. 7, Commodity Futures Trading Commission data
show. That’s the highest since Sept. 20. Bullish wagers on copper rose
to a six-month high, and soybean holdings jumped by the most this year.
The Standard & Poor’s GSCI Spot Index of 24
commodities rose to a six-month high on Feb. 9, a day after the MSCI All-
Country World Index entered a bull market, as indicators signaled
accelerating growth. Fewer Americans than forecast filed claims for jobless
benefits in the week to Feb. 4, and consumer confidence rose to a one-year
high. Investments in commodities expanded for a seventh week, the longest
streak since February 2009, data compiled by Bloomberg show.
“The improving economic data, not just in the
U.S., we’ve seen better data in Europe as well, has put recession fears
on the back burner,” said Anthony Valeri, a
market strategist with LPL Financial in San Diego, which oversees $330
billion of assets. “That augers well for commodity demand.”
Silver Rally
The
S&P GSCI gauge rose 1 percent last week. The number of futures contracts
on 24 commodities from oil to copper rose 0.8 percent, extending this
year’s expansion to 13 percent. The MSCI index of equities ended the
week down 0.4 percent, and the yield on 10-year Treasuries rose 6.4 basis
points, or 0.064 percentage point, according to Bloomberg Bond Trader prices.
Seventeen of the raw materials tracked by the S&P
GSCI gained this year, led by a 20 percent advance in silver. Zinc jumped 13
percent and copper climbed 12 percent.
(Bloomberg) -- Gold to Peak, ‘Challenge’ $2,200
in 2012, Societe Generale
Says
Gold will “challenge” $2,200 an ounce by the end of this year as
it peaks, Societe Generale
SA said in a cross asset research report e-mailed today.
“Global liquidity, negative real interest rates
and persistent fears over fiat currencies as a whole will boost investment at
all levels,” the bank said. “Even when the sovereign debt issues
have been resolved in Europe, inflation will by then be an important
issue.”
(SET News) -- Thai bourse sees Gold ETFs as opportunity for
investment
The Stock Exchange of Thailand (SET) confirms that trading prices of all four
gold exchange-traded funds (ETFs) listed on SET are efficiently in line with
gold prices in the global market and their net asset values, and the exchange
also assures investors of its surveillance system. "The gold ETFs have
proven very attractive for domestic investors since they listed on SET late
last year, with a combined trading valuation of THB 6.52 billion (approx. USD
210 million) in 2011, because the instrument is an innovative financial tool
well-designed to meet investor demand for gold trading. The SET-listed ETFs
enable investors to buy or sell at any time during exchange trading hours and
provide real-time indicative net asset values (iNAVs),
unlike general gold funds. There is also no currency risk as the ETFs are
traded in the Thai baht currency," said Pakorn
Peetathawatchai, SET's Chief Marketing Officer.
Prices of gold ETFs listed on SET have tracked those of
gold prices in the global market and trading prices are usually in line with
gold fund's NAVs because leading gold brokers have participated as market
makers. Consequently, investors have the opportunity to get returns similar
to those from trading in physical gold without worries over the storage of
gold, and can be assured by SET's settlement and market surveillance systems.
SILVER
Silver is trading at $33.83/oz,
€25.51/oz and £21.40/oz.
PLATINUM GROUP METALS
Platinum is trading at $1,657.50/oz, palladium at
$695/oz and rhodium at $1,500/oz.
NEWS
(Reuters)
PRECIOUS-Gold rises on Greek austerity bill, off
2-week low
(The Sydney Morning Herald)
Gold gains on Chinese buying
(Reuters via Sharenet)
Shanghai Gold Exchange eyes OTC trade via interbank
market
(Agence France Presse)
Vietnam battles 'gold fever' as price soars
(Reuters)
Sudan central bank ups dollar supply after gold sale
COMMENTARY
(Marketwatch)
Brimelow: Gold breaks on cue — is rebound
coming?
(The Telegraph)
Iran presses ahead with dollar attack
(The Telegraph)
Britain's extreme QE is dangerously
counter-productive
(KingWorldNews)
John Williams - The US Edges Closer to Collapse
(Max Keiser)
Keiser Report: FBI vs Gold
Standard ‘Extremists’
(ZeroHedge)
Whither Gold
(Business Insider)
Mauldin: The Truth Is It Doesn't Matter Who's
President -- We'd Be Screwed Regardless
(True Economics)
Gurdgiev: Few Thoughts on the Global Policy Crisis
Mark
O’Byrne
Goldcore
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