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Gold’s London AM fix this morning
was USD 1,662.00, EUR 1,271.61, and GBP 1,057.93 per ounce.
Yesterday's AM fix was USD 1,694.75, EUR
1,291.44and GBP 1,082.63 per ounce.
Gold fell 1.7% in New York yesterday and
closed at $1,676.10/oz. Gold fell in Asia prior to further falls in Europe
which has gold now trading at $1,656/oz.
Fed Chairman Ben Bernanke offered no
insight as to whether there will be another round of QE and the Fed said the
economy was "expanding moderately" though growth still faced
significant downside risks.
Gold has broken below $1,660/oz to its lowest since January 25. Gold is now below the
200-day SMA at $1,681.08/oz as well as the 38.2%
Fibonacci retracement from September's record to December's lows.
Support is at $1,650/oz
and below that at $1,600/oz and $1,550/oz (see chart below).
Despite continuing caution regarding gold
in western markets, lacklustre buying and indeed
some selling - there is still strong buying from Asia store of wealth buyers.
Singapore Seeks To Be Asian Bullion Hub
With Tax Free Gold and Silver
Another sign of Asia’s increasing
importance in the global gold market is news that Singapore is planning to
boost its share of global gold trade sevenfold after scrapping taxes on gold,
silver and platinum bullion.
This is the aim of the International
Enterprise Singapore, the city state’s external trade agency according
to Bloomberg.
Currently just 2% of world gold demand
flows through Singapore and Singapore is aiming to increase that to 10% to
15% over the next five to 10 years, Kathy Lai, assistant chief executive
officer at IE Singapore, said.
Singapore will exempt investment grade
gold, silver and platinum from the 7% goods and services tax to turn the
country into a bullion trading hub, Finance Minister Tharman
Shanmugaratnam told parliament in his budget speech
on February 17. The change, which takes effect on Oct. 1, will apply to gold
of 99.5 percent purity, silver of 99.9 percent purity and platinum of 99
percent purity.
“Most other financial centers
consider gold as a financial asset so few place any kind of tax on precious
metals and we discovered that it was an impediment,” said IE
Singapore’s Lai. “We noted that gold demand increasingly is
dominated by Asian consumers and investors and we feel that this is something
we may have missed out on.”
Asia doesn’t have a so-called gold
hub, where there’s a critical mass of traders and storage, like in
London and Zurich, said Lai.
“Vis-a-vis
Dubai, we are a more credible financial center, vis-a-vis Hong Kong, we are seen as not part of China and
therefore more neutral,” she said.
This is another step towards price
discovery in the precious metals market being related to supply and demand of
the physical metal and not the machinations of banks and hedge funds
manipulating the paper gold market on the COMEX.
Bloomberg Link Precious Metals Conference
– Gold 21% Gain In 2012
The Bloomberg Link Precious Metals
Conference took place in New York yesterday and the majority of participants
were bullish on gold (see Other News below).
Gold may rise to $1,897/oz by December 31 from $1,566.80 at the end of 2011,
based on the average of 14 respondents in a survey at the conference.
Gold is poised for a 21% gain in 2012,
extending its bull market to 12 consecutive years, as investors diversify
into gold and central banks expand reserves for the first time in a generation.
The majority of participants expect
central banks will take additional steps to spur economic growth and continue
to debase currencies.
OTHER NEWS
(Bloomberg) -- China Platinum Jewelry Use
May Rise to 3 Million Ounces: BofA
China’s jewelry demand for platinum
may rise to about 3 million ounces by 2016 from 1.8 million ounces in 2011,
Michael Widmer, a London-based analyst at Bank of
America Corp. said in a report e-mailed today.
(Bloomberg) -- India May Consider Tax
Increases for Gold Imports, UBS Says
India may consider higher taxes for gold
imports to reduce its fiscal deficit, UBS AG said. Outright controls on the
quantity of imports may even be considered “although we give this riska remote possibility, not least because it might
portend a re-opening of the old smuggling routes from yester years,” Edel Tully, an analyst at UBS, said in a report e-mailed
today. India is set to publish its 2012 budget on March 16, she said.
(Bloomberg) -- Aggressive Investors
Should Hold 20% in Gold, Tangent Says
More-aggressive investors should allocate
20 percent of their portfolio to gold, while conservative investors should
put 10 percent into the precious metal, James Rickards,
a senior managing director of Tangent Capital Partners, said today at the
Bloomberg Link Precious Metals Conference in New York. China is doing
everything possible to increase its ratio of gold holdings to gross domestic
product, Rickards said.
(Bloomberg) -- Palladium May Surge to
$1,000 An Ounce This Year, Lee Says
Palladium prices may jump to $1,000 an
ounce this year as investor demand climbs, John Lee, the chairman of Prophecy
Platinum Corp., said today at the Bloomberg Link Precious Metals Conference
New York. Platinum may trade at a premium of 20 percent to 30 percent above
gold prices, Lee said.
(Bloomberg) -- Platinum, Palladium Mining
Getting Harder, Raithatha Says
It’s getting more difficult to mine
platinum and palladium because costs are rising in South Africa and Russia, Rupen Raithatha, an analyst at
Johnson Matthey, said today at the Bloomberg Link Precious Metals Conference
New York.
(Bloomberg) -- Gold-Mining Deals Will
Rise on Higher Prices, McEwen Says
Mergers and acquisitions among
gold-mining companies will rise, Rob McEwen, the founder of Goldcorp Inc. and
the current chairman and chief executive officer of McEwen Mining Inc., said
today at the Bloomberg Link Precious Metals Conference in New York.
“At higher prices, a lot of people
are investing in exploration and creating investing opportunities,”
McEwen said. “Management should not sit on cash.”
(Bloomberg) -- Investors Should Hold Gold
Even With Zero Returns, Artigas Says
It makes sense for investors to hold gold
even when there are zero returns because the precious metal helps to preserve
capital, especially during times of risk, Juan Carlos Artigas, a manager of
investment research at the World Gold Council, said today at the Bloomberg
Link Precious Metals Conference New York.
(Bloomberg) -- Gold May Rally to $2,150
at the End of This Year, Pento Says
Gold’s rally will extend to a
record $2,150 an ounce at the end of 2012 as low interest rates boost demand
for the precious metal, according to Michael Pento,
president of Pento Portfolio Strategies in Holmdel,
New Jersey.
Gold has climbed 8.4 percent this year
and in September traded at a record $1,921.15 in London, as governments from
the U.S. to the U.K. keep interest rates at all-time lows to shore up growth.
The metal may end 2012 at $2,000 as the Federal Reserve takes more steps to
boost growth, Francisco Blanch, head of global commodity research at Bank of
America Merrill Lynch, told the Bloomberg Precious Metals conference in New
York today.
“We have to own gold,” Pento, who correctly predicted the annual high for prices
in the past three years, said during a panel at the conference.
Gold is heading for a 12th annual advance
and investors now hold a record 2,408.98 metric tons valued at $131 billion,
data compiled by Bloomberg show. Its gain this year to $1,694.85 an ounce
today lags the 9.4 percent gain in the Standard & Poor’s GSCI gauge
of 24 commodities and a 10 percent appreciation in the MSCI All-Country World
Index of equities. Treasuries fell 0.5 percent, a Bank of America Corp. index
shows.
Gold’s Fundamentals
“You have to trade it,” said Christoph Eibl, a founding
partner of Zug, Switzerland-based Tiberius Asset Management AG. Gold probably
has the worst fundamentals of all commodities and may end the year at $1,200
to $1,300, he said at the conference.
Gold is the “ultimate macro
hedge,” Rachel Benepe, portfolio manager at
First Eagle Gold Fund, First Eagle Investment Management LLC, said at the
conference. “Gold is the ultimate downside protection,” she said.
“When the system falls apart, gold goes up.” She declined to give
a price forecast.
Steven Mathews, chief investment officer
of Flintlock Capital Asset Management LLC in New York, forecast $1,880.
Shares of mining companies have lagged
the price of gold, with the Philadelphia Gold & Silver Index of 16 members
up 2.2 percent this year.
The purchase of a gold miner from outside
the industry would be “very helpful” to the performance of the
gold mining industry, Caesar Bryan, portfolio manager at the Gabelli Gold Fund, said at the conference. He predicted
gold would end the year at $2,300 an ounce. “Should a company from
outside the industry make an acquisition, that would be very
interesting,” Bryan said.
(Bloomberg) -- U.S. Will Have QE3 by End
of This Summer, Michael Pento Says
The U.S. will introduce a third round of
quantitative easing by the end of the summer, Michael Pento,
president, Pento Portfolio Strategies, said in an
interview with Bloomberg Television.
“QE3 by the end of the summer is
what I’m expecting, absolutely,” Pento
said at the Bloomberg Precious Metals conference in New York. “There
has been no healing in the economy. We have not deleveraged as an economy at
all,” said Pento, adding that the commercial
banks are financing $1 trillion of annual deficits.
(Bloomberg) -- Gold Prices ‘Fairly
Pedestrian,’ Dundeewealth’s Murenbeeld Says
Gold prices are “fairly
pedestrian” given the global low interest-rate environment, Martin Murenbeeld, chief economist at DundeeWealth
Inc., said at the Bloomberg Precious Metals conference in New York.
Bullion is up 8 percent this year,
heading for a 12th annual advance. Gold for immediate delivery reached a
record $1,921.15 an ounce, and futures an all-time high of $1,923.70, in
September.
(Bloomberg) -- Gold Is the
‘Ultimate Macro Hedge,’ First Eagle’s Benepe
Says
Gold is the “ultimate macro
hedge,” Rachel Benepe, portfolio manager at
First Eagle Gold Fund, First Eagle Investment Management LLC, said today at
the Bloomberg Precious Metals conference in New York.
“Gold is the ultimate downside
protection,” Benepe said. “When the
system falls apart, gold goes up.”
For breaking news and commentary on
financial markets and gold, follow us on Twitter.
NEWS
Reuters
Gold slips for third day; equities weigh, dollar weigh
Bloomberg
Gold Seen Heading for 12th Annual Advance on Investor
Hoarding/ Buying
MarketWatch
Gold, silver sink in electronic trading
Wall Street Journal
Beijing Defends Stance on Minerals
COMMENTARY
Business Insider
JIM GRANT: Warren Buffett & Coca-Cola Investors
Humiliated By Gold
CNBC
Video: Taleb on Next 'Black
Swan' Event - Ron Paul?
Zero Hedge
Japan's Shocking Keynesian Slip: "We Are Worse Than
Greece"
Zero Hedge
Presenting Bridgewater's Weimar Hyperinflationary Case
Study
YouTube
Keiser Report: Cites Vulnerability of German, Swiss Gold
Reserves
Mark
O’Byrne
Goldcore
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