Month: September 2012

London Gold Market Report
from Ben Traynor
BullionVault
Tuesday 25 September 2012, 08:00 EDT

SPOT MARKET gold bullion prices traded around $1765 an ounce Tuesday morning in London, 1.8% off last Friday’s seven-month high.

“It looks to me like we’ve got a short period of consolidation,” says Standard Chartered analyst Daniel Smith.

“[We’ll see] maybe a month of sideways trading possibly and then generally trending higher in the next six months to a year.”

Stock markets were also broadly flat as major government bond prices gained, while the Euro recovered early losses ahead of a meeting between the leaders of Germany and the European Central Bank.

Tuesday also brought fresh news of central bank gold buying, while SPDR Gold Shares (GLD), the world’s biggest gold ETF, saw its gold bullion holdings hit a new record Monday at 1326.8 tonnes.

Overall gold ETF holdings tracked by newswire Reuters also hit a new record at 2294.3 tonnes.

Silver bullion held by the world’s biggest silver ETF, iShares Silver Trust (SLV), rose to just under 10016 tonnes yesterday, their highest level since September 2011.

“We still prefer to be buying gold on dips and believe the break higher will eventually come,” says Walter de Wet, commodity strategist at Standard Bank.

“But the futures market needs to lose some speculative length and the physical market needs to adjust to a higher price-range first.”

The aggregate positioning of Comex gold futures and options traders rose to its highest reported level since February last week, according to weekly data published by the Commodity Futures Trading Commission. October gold option contracts on the Comex expire later today.

On the supply side, London-listed pawnbroker Albermarle & Bond has announced a reduction in new store openings in the next financial year, citing a “sudden slowdown” in profit growth from buying and recycling scrap gold.

“We expect gold buying to continue to be a significant profit contributor…albeit at much reduced levels to that achieved at the peak,” chief executive Barry Stevenson said.

The firm plans to open five stores in the next financial year, compared to 25 opened in 2011-12.
Silver prices meantime climbed to $34.31 an ounce – 2.6% off last week’s high – while other industrial commodities also ticked higher.

“Silver is still within the recent range and we feel it is too early to call a reversal,” says the latest technical analysis from bullion bank Scotia Mocatta.

Over in Europe, German chancellor Angela Merkel and European Central Bank president Mario Draghi are due to meet today in Berlin, where they are expected to discuss the Eurozone crisis.

Spain’s deputy prime minister meantime has said she wants to see more details of the ECB’s unlimited sovereign bond buying program announced earlier this month.

“We need to know to what extent the ECB will intervene in the secondary market,” Soraya Saenz de Santamaria said Tuesday.

“To take decisions you need to have all the elements on the table.”

Spain sold €4 billion of 3-Month and 6-Month bills at auction this morning, with borrowing costs ticking higher from a month earlier.

Italy meantime sold €3.94 billion of 2-Year debt, compared with a maximum target of €4 billion.

Elsewhere in Europe, Switzerland’s central bank bought an estimated €80 billion of so-called core Eurozone sovereign debt in the first seven months of the year, according to a report published Tuesday ratings agency Standard & Poor’s.

“In our view, this has significantly contributed to the declining yields on bonds issued by the core sovereigns,” the report says.

Yields on 6-Month German Bubills have spent much of the year in negative territory, while 10-Year Bund yields have at times traded at less than 1.2%. By contrasts, Spain’s 10-Year government bond yields spiked above 7.7% in July.

Last year, the Swiss National Bank announced it was placing a floor under the Euro’s exchange rate with the Swiss Franc and would not allow it fall below SFr1.20. The SNB pledge “unlimited” currency purchases to support this peg.

The central banks of South Korea, Paraguay and Ukraine meantime all added to their gold reserves over the last two months, according to International Monetary Fund data published Tuesday.

Korea added nearly 16 tonnes of gold bullion in July, taking total reserves above 70 tonnes, while Paraguay’s holdings rose by 7.5 tonnes to 8.2 tonnes in the same month. Ukraine added just under 1.9 tonnes in August, taking official reserves to 34.8 tonnes.

Venezuela, which repatriated most of its gold last year, cut its holdings by 3.7 tonnes, taking the total to 362 tonnes.

Turkey’s central bank also reported a rise of 6.6 tonnes, although Turkey’s gold holdings include gold held with the central bank by commercial institutions as part of their reserve requirements.
China’s central bank injected a record 290 billion Yuan into financial markets Tuesday, ahead of a week-long public holiday next week.

Ben Traynor
BullionVault

Gold value calculator   |   Buy gold online at live prices

Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK’s longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics. Ben writes and presents BullionVault’s weekly gold market summary on YouTube and can be found on Google+

(c) BullionVault 2012

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.

By TraderVox.com

Tradervox.com (Dublin) – Chinese growth data and euro-zone concerns have pushed the south pacific dollar down against the greenback, as speculation global growth is slowing rose, limiting the demand for asset related currencies. The Australian dollar declined against most of its traded peers as Chinese Economic Information Daily indicated that there is downward pressure on the second largest economy. The New Zealand dollar dropped against major counterparts on increased speculation that euro region leaders’ disagreement is hampering growth in the region.

According to James Richards, Tangent Capital Partners’ Senior Managing Director, the big question RBA is struggling with is whether to curb currency risk by cutting rate, which would weaken the currency, or do they wait and see the benefits they can reap from it. He predicted that the Reserve Bank of Australia will embrace the strong currency as the economy looks strong enough. The RBA is projected to leave the benchmark interest rate unchanged when they meet on October 2.

The RBA has lowered the interest rate by 1.25 percentage points as it seeks to shove the economy from effects of the European debt crisis and the slowing Chinese economy. The RBA signaled that it would reduce interest rates should the outlook for the economy change. However, with the recent assessment by the bank, the economy is in good footings hence the current interest rates might be extended for another month. The other south pacific currency, the Kiwi, has increased by 3.6 percent this year, making it the best performer among ten developed-economy currencies. The Aussie has declined by 0.4 percent while the US dollar dropped by 2.7 percent in the same period.

After the Chinese and Euro zone economic data, the Australian dollar dropped by 0.3 percent to trade at $1.0425 in New York yesterday where it had fallen by 0.7 percent. It dropped by 0.7 percent against the yen to exchange at 81.16 yen. The New Zealand dollar depreciated by 0.8 percent against the dollar to exchange at 82.29 US cents while it dropped by 1.1 percent against the yen to trade at 64.06.

Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management. 

Article provided by TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox

By TraderVox.com

Tradervox.com (Dublin) – According to Reserve Bank of Australia, the Australian households are preventing the economy from global economic shocks by repaying their mortgages at a higher rate and saving more. The statement for the central bank, further, indicated that businesses in the country are having renewed willingness to borrow, boosting the country’s economy.

The Reserve Bank of Australia indicated in its semiannual financial stability review that the large share of households with mortgage prepayment buffers, income growth, and low unemployment rate signal that most households are able to meet their debt obligations. The review also highlighted that the mining industry, which has kept Australian economy from recession for the last 21 years, has slowed down posing a risk to the economy. The statement noted that the Australian consumers took more debt that their American counterparts. With the highest interest rates among the major developed nations, policy makers in Australia have exuded confidence in the RBA’s ability to cope with economic shocks that might be as a result of global economy.

Talking about the RBA semiannual financial review, Ben Jarman said that report shows that households in Australia have enough “shock-absorber” in case there in case of income. Jarman, who is a JPMorgan Chase & Co Chief Economist in Sydney, added that the report have revived optimistic sentiments from those people who were downbeat about the economy. The report also showed that the business credit rose by 6.5 percent annualized rate in the last six months ending July. This is a reverse from the previous half a year rate which showed a decline. This has been construed as a change in companies’ appetite for debt, which is seen as increasing.

However, the report noted that credit growth in the country may remain subdued since banks are set to miss their high profits they have been used to. The central bank warned against financial institutions’ addition of new products in the market or loosening their lending standards.

Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management. 

Article provided by TraderVox.com
Tradervox.com is a Forex News Portal that provides real-time news and analysis relating to the Currency Markets.
News and analysis are produced throughout the day by our in-house staff.
Follow us on twitter: www.twitter.com/tradervox

Article by AlgosysFx Forex Trading Solutions

Positive economic reports from the US today are deemed to strengthen the US dollar opposite its Swiss counterpart on views that the world’s largest economy is on track for recovery. Gauges of housing, consumer confidence and manufacturing are believed to show modest improvements, enhancing optimism for the US economy. Meanwhile, the bleak developments out of its primary trading partners in the Euro Zone will likely dampen the appeal of the Swissie.

Long considered a drag to the US economy, the housing market is seemingly recovering and is even gaining momentum. House prices have seemingly stabilized considering the recent increase in housing activity across the country. The Standard & Poor’s/Case-Schiller Composite-20 House Price Index is estimated to have inclined by 1.3 percent in July, larger than the 0.5 percent rise in the previous month and is potentially the largest monthly increase since August 2010. Corroborating this report, the FHFA is awaited to disclose that its House Price Index report rose by 0.4 percent in July to follow up the 0.7 percent increase in the previous month. Such price rises are likely to benefit the broader economy. When home prices increase steadily, Americans typically feel wealthier and spend more, a point the Federal Reserve Chairman Ben Bernanke made last week after the Fed unveiled a third round of quantitative easing.

Recent strides in housing have likely helped sentiment among American consumers improve this month despite sluggish job growth. The Conference Board Consumer Confidence report is deemed to recover from 60.6 points to 63.1 points in September, suggesting that at the primary engine of the economy is set to boost growth in the coming months. Manufacturing is also showing encouraging signs of recovery. Following the heels of the Philly Fed survey, manufacturing conditions in the Richmond area are also contracting at a slower rate. The Richmond Manufacturing Index is projected to improve to -6 points this month from -9 points in August. Considering all these positive signals for the US economy, the Greenback is believed to rise alongside its fellow safe haven counterparts.

Meanwhile, the Swissie is believed to drop on signs that the lingering debt crisis is taking its toll on the Euro region’s largest economy. Yesterday, the Germany Ifo Business Climate dropped for a fifth consecutive month to 101.4 points in September from 102.3 points, the weakest reading since February 2010. Earlier today, the GfK German Consumer Climate disappointed as it held steady at 5.9 points this month, defying forecasts of a rise to 6.0 points. With the outlook for the Swiss economy also in peril, a long position is viable for the USD/CHF in favor of the US dollar.

For more news, analysis, technical charts and candlestick analysis, visit AlgosysFx

Source: ForexYard

A worse than expected German Ifo Business Climate indicator yesterday resulted in risk aversion among investors which caused the euro to extend its recent bearish trend. The news also weighed down on commodities, including crude oil which fell throughout the day. Today, several pieces of news have the potential to generate market volatility. Traders will want to pay attention to a speech from ECB President Draghi at 13:00 GMT, followed by the US CB Consumer Confidence figure at 14:00. Any positive comments from Draghi could help the euro recover yesterday’s losses, while a better than expected consumer confidence figure could boost the USD/JPY.

Economic News

USD – Investors Await US Consumer Confidence Figure

The US dollar was able to gain against several of its main currency rivals yesterday, after worse than expected news out of Germany caused investors to shift their funds to the safe-haven greenback. The GBP/USD fell close to 60 pips during European trading, eventually reaching as low as 1.6181 before bouncing back to the 1.6195 level. Against the Swiss franc, the dollar was able to advance more than 50 pips to trade as high as 0.9390. A slight downward correction brought the USD/CHF to the 0.9375 level by the evening session.

Today, the main piece of US economic news is likely to be CB Consumer Confidence figure, set to be released at 14:00 GMT. Analysts are forecasting the figure to come in at 62.9, slightly better than last month’s reading of 60.6. Any better than expected news could help the greenback recoup some of its recent losses against the Japanese yen and extend yesterday’s gains against the AUD and CHF. At the same time, traders should keep in mind that if today’s indicator comes in below the forecasted level, the USD could see losses during afternoon trading.

EUR – Draghi Speech May Lead to Euro Volatility

The euro saw downward movement against virtually all of its main currency rivals after a worse than expected German Ifo Business Climate figure led to doubts regarding the euro-zone’s ability to recover from its debt crisis. The EUR/USD fell 65 pips after the news was released to briefly trade below the psychologically significant 1.2900 level. By the afternoon session, the pair had stabilized at 1.2910. Against the British pound, the common currency fell close to 30 pips to reach a two-week low at 0.7953. A slight upward correction brought the euro back up to 0.7969 by the afternoon.

Today, all eyes are likely to be on a speech from ECB President Draghi, scheduled to take place at 13:00 GMT. In addition to the disappointing German news yesterday, the euro has also been weighed down by uncertainties surrounding the debt situations in Spain and Greece. That being said, if Draghi voices optimism today with regards to the euro-zone economic recovery, the common currency may be able to recoup some of yesterday’s losses.

Gold – Gold Sees Modest Recovery

After falling more than $13 an ounce when markets opened for the week, gold was able to stage a slight recovery during European trading yesterday. The precious metal was trading as low as $1755.38 during morning trading before bouncing back to the $1763 level, well below last Friday’s 6 ½ month high of $1787.

Today, gold traders will want to pay attention to ECB President Draghi’s speech at 13:00 GMT. If he sounds an optimistic tone regarding the euro-zone’s prospects for economic recovery, risk taking may help gold recover some of yesterday’s losses.

Crude Oil – Crude Oil Starts Week on Bearish Note

The price of crude oil fell once again when markets opened for the week yesterday, as risk aversion caused investors to abandon higher-yielding assets. Analysts attributed the bearish movement to disappointing news out of the euro-zone. Crude fell more than $1 a barrel during European trading, eventually reaching the $91.00 level.

Turning to today, oil traders will want to pay attention to a US consumer confidence figure. Any better than expected data could lead to speculations that demand for oil in the US will increase, which may result in the price of oil recovering some of its recent losses during afternoon trading.

Technical News

EUR/USD

A bearish cross on the weekly chart’s Slow Stochastic indicates that this pair may see a downward correction in the near future. Additionally, the Williams Percent Range on the same chart has crossed over into overbought territory. Opening short positions may be the wise choice for this pair.

GBP/USD

The daily chart’s Relative Strength Index has crossed into the overbought zone, signaling a possible downward correction in the near future. This theory is supported by the weekly chart’s Williams Percent Range, which is currently above the -20 level. Traders may want to open short positions for this pair.

USD/JPY

While a bearish cross has formed on the daily chart’s MACD/OsMA, most other technical indicators place this pair in neutral territory. Traders may want to take a wait and see approach for this pair, as a clearer picture is likely to present itself in the near future.

USD/CHF

The Bollinger Bands on the weekly chart are narrowing, indicating that this pair could see a price shift in the near future. Furthermore, the Williams Percent Range on the same chart has crossed into oversold territory, signaling that the price shift could be upward. Opening long positions may be the wise choice for this pair.

The Wild Card

GBP/CAD

A bearish cross on the daily chart’s Slow Stochastic indicates that this pair could see a downward correction in the near future. Additionally, the Williams Percent Range on the same chart is currently above the -20 level, lending further support to the theory of an impending downward correction. Forex traders may want to open short positions for this pair.

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

By Central Bank News
Here’s today’s Central Bank News link list, click through if you missed the previous link list. The list comprises news about central banks that is not covered by Central Bank News. The list is updated during the day with the latest developments so readers don’t miss any important news.

Source: ForexYard

The euro fell to a one-week low against the US dollar in overnight trading, as investor fears regarding Spain and Greece’s debt situation, combined with a worse than expected German business climate indicator yesterday, led to risk aversion in the marketplace. After trading as low as 1.2885, the EUR/USD was able to stage a slight upward correction and is currently at 1.2910. The price of crude oil saw minor downward movement last night before staging a bullish correction during early morning trading. The commodity, which is currently trading at $92.55 a barrel, has gained close to $1 since European trading began.

Main News for Today

ECB President Draghi Speaks- 13:00 GMT
• Given the recent resurgence in concerns regarding the debt situations in Greece and Spain, investors will be eagerly watching this speech
• If Draghi is able to calm investor fears regarding the pace of the euro-zone economic recovery, the euro could see bullish movement in afternoon trading

US CB Consumer Confidence- 14:00 GMT
• The consumer confidence figure is expected to come in at 63.1, slightly higher than last month’s
• Any better than expected news could help the dollar stage an upward correction against the JPY

Read more forex news on our forex blog

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

After eight weeks of upward progress on the back of the European Central Bank’s “Draghi Plan” to save the single currency the euro ran out of steam. At the beginning of last week investors came to the conclusion that their optimism had been overdone. Whether or not the plan would eventually take effect, it was unlikely to progress from words to action in the near future. With this in mind investors reduced their euro holdings, money transfer are going into the safe-haven yen and US dollar.

The brief panic of ten days ago, when news of a third round of quantitative easing by the Federal Reserve sparked a rash of dollar sales, was forgotten. An announcement that the Bank of Japan would also embark on further QE held the yen back for only a few hours. Perceived safety counted for more than the jam-one-day of a revivified euro system. The euro found itself at the bottom of the heap.

For once sterling was able to avoid the downward drag of the euro. It celebrated its newfound – if perhaps only temporary – freedom by accompanying the US dollar to second place in the week’s chart. Sterling had nothing particularly to brag about; reaction to the week’s few UK economic data smacked more of relief than jubilation. Inflation was a touch lower at 2.5%, retail sales fell by less than expected in Olympics August and at this month’s meeting no member of the Monetary Policy Committee voted for more QE.

Other than the euro’s relapse and sterling’s joint number two slot, it was a fairly dull week. The lead-up to the end of the month threatens to be no less tedious. With no top-tier economic statistics on the agenda it will require unscheduled events or comments to get things moving and increase international payments.

GBPUSD moves sideways in a range between 1.6163 and 1.6309. The price action in the range is likely consolidation of the uptrend from 1.5490 (Aug 2 low). Support is at 1.6163, as long as this level holds, another rise towards 1.6500 could be expected after consolidation, and a break above 1.6309 could signal resumption of the uptrend. On the downside, a breakdown below 1.6163 will indicate that lengthier consolidation of the uptrend is underway, then the pair will find support around 1.6050 area.

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