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Gold is trading at USD 1,740.10, EUR 1,295.90, GBP
1,114.30, CHF 1,604.5, JPY 135,900 and AUD 1,700.4 per ounce.
Gold’s London AM fix this morning was USD 1,744,
GBP 1,114.88, and EUR 1,296.08 per ounce.
Friday's AM fix was USD 1,751.00, GBP 1,116.50, and EUR
1,298.29 per ounce.
Cross Currency Rates
At the open in Asia, gold spiked from $1,746.75/oz to $1,755/oz before being
capped at that level and falling back to its opening price. It remained near
the $1745/oz mark overnight and this morning in
Europe until soon after the London AM Fix ($1,744/oz)
when selling commenced again.
Traders may be hesitant to place positions ahead of the
Franco-German summit and there may also be some profit taking after the
nearly 4% gains seen last week.
Gold will likely be supported this week by the
intractable eurozone debt crisis and renewed
jitters about Iran which has seen oil rise again today (NYMEX/ WTI at
$101.80).
Iran warned yesterday that any move to block its
exports would lead to oil at $250 a barrel.
Physical buying continues internationally. Indian gold
edged higher this morning following a weaker rupee, and premiums in the
physical market steadied after a recent lull in buying. Chinese demand is
gradually picking up again ahead of Chinese New Year.
Safe haven demand from Eurozone countries has increased
significantly in recent days due to the concerns about euro exposure due to
the possible collapse of the single currency.
Speculators, hedge funds and money managers pared their
holdings of Comex gold and silver futures and
options in the week ended Nov. 29, according to data released Friday by the
Commodity Futures Trading Commission (CFTC).
The CFTC data, typically released Friday, were delayed
because of the Thanksgiving holiday.
In gold futures and options, 4,207 long positions were
cut and 1,249 short positions were cut.
This reduced their net position by 2% to 146,298 long
contracts, from 149,256 long contracts a week earlier.
The managed fund net-long position represents around
14.6 million troy ounces of gold.
In Comex silver futures and
options, these funds added 110 long contracts and 316 short contracts. This
reduced their net long position by 2% to 12,334 contracts, from 12,542
contracts the previous week.
The net silver position represents around 61.6 million
troy ounces of silver.
In platinum, 243 long positions were cut and 555 short
lots were added, taking the net long position down to 12,952, from 13,750.
In palladium, 64 long lots were cut and 506 short lots
were added, reducing the net long position to 5,231 from 5,800.
Volatility in currency markets has increased markedly
in recent months and this looks set to continue in the coming weeks as
liquidity dries up in the run up to and during Christmas and New Years.
Currency markets have proved even more difficult to
predict than usual due to the global debt crisis. News headlines and rumours are causing large swings in the market.
Intervention from governments around the world to
weaken their currencies and competitive currency devaluations have surprised markets.
Investors can no longer assume that the yen, Swiss franc and the US dollar
will be safe havens.
Foreign exchange trading today normally averages
£4 trillion (€4.7 trillion) a day, according to the Bank for
International Settlements.
2012 Top Trades of BOA - Buy Gold Versus Euro
Gold and
the dollar are Bank of America Merrill Lynch’s top currency trades for
2012.
BOA, the second-biggest U.S. bank by assets after
JPMorgan Chase & Co., said that investors should buy gold versus the euro
as the ECB engages in quantitative easing to contain debt turmoil.
David Woo, global head of rates and currencies in New
York at the Bank of America Corp. unit, told clients in research note that
“the ECB will be buying more government debt and doing QE, so buy gold
against the euro.”
“The second major theme is U.S. fiscal tightening
is about to come, and the U.S. economy will slow,
and this will be very good for the U.S. dollar.”
“The general theme for the year ahead is pretty
negative for the risk environment,” Woo said.
For breaking news and commentary on financial markets
and gold, follow us on Twitter.
SILVER
Silver is trading at $32.60/oz,
€24.24/oz and £20.83/oz
PLATINUM GROUP METALS
Platinum is trading at $1,541.70/oz, palladium at
$644.75/oz and rhodium at $1,575/oz.
NEWS
(Reuters)
Gold inches up as key EU summit nears
(Reuters)
Decision time for EU, with euro's future at stake
(Washington Post)
Oil rises to near $102 a barrel in Asia amid rising
Iran tension
(Reuters)
Iran says oil would go over $250 if exports banned
COMMENTARY
(Financial Times)
Are We Heading Back to 1929 - Or the Dark Ages?
(Financial Times)
France and Germany Look Set to Fudge It Yet Again
(Best Bullion)
Laura Gross: Goldbug
Defined
(Economic Policy Journal)
Is Your Money Safe at Your Brokerage Firm?
(NY Sun)
Bernanke’s Forgotten Footnote
(ZeroHedge)
No, Dylan Grice Did Not Say Germany's Unwillingness
To Print May Lead To The Rise Of Another Hitler
(Wall Street Journal)
Weighing Loss of Iran's Oil
Mark
O’Byrne
Goldcore
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