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Today's AM fix was USD 1,622.75, EUR 1,323.29,
and GBP 1,034.46 per ounce.
Yesterday’s AM fix was USD 1,616.50, EUR 1,317.87 and GBP 1,029.75 per
ounce.
Silver is trading at $28.21/oz,
€23.06/oz and £18.06/oz. Platinum is
trading at $1,429.20/oz, palladium at $585.80/oz and rhodium at $1,100/oz.
Gold fell $1.30 or 0.08% in New York yesterday
and closed at $1,622.10/oz. Silver pulled back to $27.53 in Asia, but then it
hit a high of $28.23 in New York and ended with a gain of 1.55%.
Cross Currency Table – (Bloomberg)
Gold is flat on Tuesday ahead of the US Federal
Reserve's policy meeting later today where investors hope to receive some
hints on the bank’s position on quantitative easing. Many analysts are
not expecting large policy moves.
The US Federal Reserve Bank of Kansas City has
its Jackson Hole Economic Symposium scheduled at the end of August, which
will be significant for determining policy expectations ahead of the
September 13th FOMC meeting. Attendees include prominent central bankers,
finance ministers, academics, and financial market participants from around
the world.
The European Central Bank has its policy meeting
this Thursday, and because of Mario Draghi’s
comments last week, some action is expected. Draghi
is set to come out with a plan that involves employing the SMP (securities
market program) bond-buying program coupled with EFSF/ESM purchases of
Spanish and Italian bonds on primary markets. The main plan,
was also confirmed by Eurogroup president
Jean-Claude Juncker according to Spanish daily El Pais.
Gold Prices/Rates/Fixes /Volumes – (Bloomberg)
Today UBS analyst, Edel
Tully, increased her short term gold bullion price targets. One month target $1,550
increases to $1,700 and three month target from $1,600 to $1,750. Factors for
the increase include hints of action from Fed post the August Economic
symposium, the next 3 months are historically the strongest for gold over the
last 36 years and finally a boost from the ECB policy statement could lift
the price as recently gold has been tracking the euro.
Spot silver surged to $28.28, its highest in
nearly 4 weeks, before easing to $28.12. Spot palladium hit $590.75, also its
highest price since the 5th of July.
In Greece, politicians in their ruling coalition
are not able to reach agreement over the austerity plan and they will seek an
extension of the bailout hoping to spread the cuts over a longer period.
Troika officials signalled this is not acceptable.
Therefore officials from the troika (European Commission, the International
Monetary Fund, and the European Central Bank will stay on later than expected
until a deal is finalized.
In a piece from the daily Gartman
Letter, editor Dennis Gartman says, The Fed
“must act at this meeting or it cannot act at all.” He mentions
that this week is basically it before the looming November election in the
US.
The Wall Street Journal quoted the following from
Gartman’s Letter: We fear that no matter what
the Fed does at the next two-day meeting its effect will be non-existent upon
the economy. That is, even aggressive easing…and we do not think that
likely…share have the most marginal of effects excepts perhaps upon
equities prices, but we do fear that doing nothing at all shall have a
detrimental effect. Thus, the Fed likely shall err upon further monetary
stimulus and shall comment openly upon that fact, but it knows in its
heart-of-monetary hearts that very little shall come of it.
In an uncertain world where central banks are
grasping with a massive global economic contraction the value of money is in
question. Quantitative easing is having less and less effect, soon inflation
will take hold and when it undermines the real economy and alters consumer behaviour the only solution will be a rapid rise in
interest rates.
Gold has shown time and time again that it is an
essential element in an investor’s arsenal. The men in dark suits and
their spin doctors will, no doubt, conjure up a series of statements exuding their
confidence in the system, reasserting that their unorthodox monetary policies
will deliver. The market grows weary, banks are consolidating back to their
home countries, and credit is again being tightened.
Until a new order in global monetary policy is
agreed upon, say a Bretton Woods II, we will continue to treat the symptoms
of this imbalanced global trade model and not its causes. Gold remains a
solid and independent hedge against the devaluation of fiat (paper) money and
its effects.
For breaking news and commentary on financial markets and gold, follow us
on Twitter.
NEWS
Gold stays put as investors eye Fed meeting
- Reuters
Most-Accurate Gold Forecasters Splitting After Rout:
Commodities – Business Week
PRECIOUS-Gold flat as investors focus on cenbank meetings - Reuters
COMMENTARY
Gold & Silver To Surge As Money Pours Into These
Markets – King World News
The Fed Can ‘Do Something,’ But Will That Do Anything?
– Wall Street Journal
Draghi Readies ECB Firepower: Central Bank May Buy
Spanish, Italian Bonds - Forbes
Mark
O’Byrne
Goldcore
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