The WHOLESALE-MARKET gold price
fell beneath last week's finish on Thursday in London, nearing its second
consecutive monthly fall against all major currencies bar the Japanese Yen as
US Treasuries rose with the Dollar.
Italian and Spanish debt prices fell, pushing interest rates higher.
Frankfurt's stock market fell for the seventh time in 9 sessions.
Brent and WTI crude oil slipped to one-week lows as France again said a joint
European-US release of strategic stockpiles is likely to depress prices.
Losing 2.0% in February, the gold price in US Dollars fell today to $1657 per
ounce, 7.0% beneath its start in March.
Gold hasn't dropped for more than two consecutive months since spring 2001
versus the Dollar, since autumn 2006 vs. Sterling, and since mid-2007 vs. the
"The view that the US economic recovery is looking more sustainable is
becoming increasingly accepted," writes UBS strategist Edel Tully in a new report, cutting the Swiss banks's average 2012 gold price target by 18% to $1680
"Gold is at risk, for it needs persistent inflows of investor money to
keep it on its upward trajectory."
"Investors need to put in well over $100 billion to the gold market in
2012 to keep prices high," said GFMS chairman Philip Klapwijk
at a CME conference in Singapore today, quoted by Reuters.
Globally, gold investment demand rose 33% by Dollar value to $83bn in 2011,
according to GFMS data.
New data today showed Russia selling down its gold bullion reserves for the
first time in 5 years last month.
Slipping by 3.8 tonnes, Russia's gold reserves have doubled by weight since 2007
to 883 tonnes, and quadrupled as a proportion of its total foreign exchange
reserves by value to 9.8%.
Figures from Data Explorers, quoted by CityWire,
say that hedge funds and other investors have sharply increased their short
sales of gold mining stocks, with 10% of Chinese miner Zijin
Mining Group currently out on loan so that investors can bet on falling
"Indian [gold] demand has been dead for three months," said a
senior Swiss logistics executive to BullionVault on
Thursday, as the strike by India's jewelry
retailers protesting a hike in import duties to 4% by value entered its 14th day .
"Nothing's moving, everyone's waiting."
"If the excise duty is corrected, the trade will be happy," MarketWatch quotes Bhargav Vaidya of the Bombay Bullion Association.
"The strike will not be indefinite, and customers will not go high and
dry during [the key] wedding season."
Meantime in the UK – which the OECD today said has fallen back into
recession – daily petrol sales jumped 81% and diesel sales by 43% on
Wednesday, according to the Petrol Retailers Association, blaming Government
minister Francis Maude for the "panic buying" by advising motorists
to fill jerry cans ahead of a possible strike by tanker drivers next week.
More broadly, and with crude oil prices near all-time records in Sterling and
Euros today, "It is the perceived potential shortage of oil keeping
prices high – not the reality on the ground," says Saudi oil
minister Ali al-Naimi writing in the FT today.
"There is no lack of supply. There is no demand which cannot be
"Used to be that Saudi Arabia produced more oil when it wanted lower oil
prices," notes Olivier Jakob at Petromatrix. "Today, when Saudi Arabia wants lower
prices it produces an op-ed in the Financial
"It shows that you either do not want or can't produce more."
Also in the UK today, Bank of China Ltd applied for membership of the London
Metal Exchange, the world's #1 base metals exchange.
BoC's UK commodities arm is the first Chinese-owned
business to apply for membership. Barclays Capital reckons that China now
buys some 40% of annual global demand for copper, aluminum
In the last 3 months of 2011, Chinese households overtook Indian consumers as
the world's top buyers of physical gold according to GFMS data, despite the
gold price recording its second-ever highest quarterly average against the