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Gold and Silver Market Morning: June 28 2017 - Gold continues to recover from the massive [mistaken?] sale!

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Published : June 28th, 2017
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Category : GoldWire

Gold TodayNew York closed at $1,249.10 yesterday after closing at$1,244.30 Monday.London opened at $1,253.00 today.

Overall the dollar was weaker against global currencies, early today. Before London’s opening:

 -The $: € was much weaker at $1.1358 after yesterday’s$1.1256: €1.

-The Dollar index was weaker at 96.36 after yesterday’s 96.97.

-The Yen was weaker at 112.36after yesterday’s 111.77:$1. 

-The Yuan was stronger at 6.8036after yesterday’s 6.8145: $1. 

-The Pound Sterling was stronger at $1.2810after yesterday’s $1.2748: £1.

Yuan Gold Fix

Trade Date

Contract

Benchmark Price AM 1 gm

Benchmark Price PM 1 gm

      2017628

2017627

2017626

SHAU

SHAU

SHAU

/

275.63

278.15

Trading at 276.80

276.41

278.03

$ equivalent 1oz at 0.995 fineness

@  $1: 6.8036

$1: 6.8145

$1: 6.8427

/

$1,253.06

$1,259.33

Trading at $1,260.42

$1,256.52

$1,258.78

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle East eastward metric measurements are used against 0.9999 quality gold.[Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

The three global gold markets are moving back into line today with London and New York rising to almost Shanghai’s level. New York rose to within $7.32 of Shanghai’s prices down from $16 lower than Shanghai, and London opened $7.42 lifting the discount to Shanghai, from $13.42. This is again, confirming Shanghai dominating pricing power.

The Yuan continues to strengthen as you can see above. The Shanghai gold price is moving independently of the Yuan’s exchange rate.

Silver Today –Silver closed at $16.68 yesterdayafter $16.57 at New York’s close Monday. Today, silver is telling us it wants to rise. Is it leading the way for gold?

LBMA price setting:The LBMA gold price was set today at $1,251.60 from yesterday’s $1,250.40.The gold price in the euro was set at €913.58 after Friday’s €1,111.17.

Ahead of the opening of New Yorkthe gold price was trading at $1,252.80 and in the euro at €912.45. At the same time, the silver price was trading at $16.84.

Gold(very short-term) The gold price should consolidate with a stronger bias, in New York today.      

Silver(very short-term) The silver price should consolidate with a stronger bias, in New York today.

Price Drivers

The I.M.F. has cut U.S. growth to 2.1% from 2.3% in 2017 with a declining growth rate in the years following, due to the U.S. having trouble adapting to trends such as changes to the job market from technology, low productivity growth and an aging population, the IMF said, noting that household incomes are stagnating for a large share of the population.

At the same time Draghi of the E.C.B. has indicated that it looks like the E.U. has turned the corner for the better after fears over the last couple of years are dissipating and he is considering reducing the stimuli currently in operation in the E.U. The immediate result has been for the euro to begin to rise strongly. If the euro rises through $1.17 we should see it beginning to soar against the dollar.

As we move to a world where a multi-currency system is coming into being we watch for evidence that confirms that. To many, Brexit is clearly a separation of the U.K. from the E.U. The U.K. will as it has done for the last century will remain very close to the U.S. Alongside this we see a growing distance on the monetary front between the E.U. and the U.S. We expect to see this in the €: $ exchange rate. In the past the rate peaked at $1.40. It is important that the previously assumed relationship between gold and the dollar was largely based on the €: $ exchange rate. That has clearly broken down as the euro rises and gold continues to consolidate around the $1,250 area. The strength of the euro has taken the euro price of gold down below €1,000.

We note that the gold price has almost recovered in the dollar from the 56 tonne sale at the beginning of the week. This has confirmed our conclusions in yesterday’s report. Some respected advisors put forward the idea that it was Venezuela doing the selling. That could not be so because Venezuela would sell physical and not in one batch. This was a “paper” futures sale involving no physical gold. That’s why the gold price has recovered.

One of the important factors in the gold price comes from dealers. To understand the gold price one cannot ignore the pricing by dealers of gold. This happens usually without actual gold sales or purchases.. As we said yesterday “… physical dealers move prices higher for fear of more physical gold buying…” They drop prices if they fear sales. This adds to the volatility of the gold price and further illustrates the differences between Shanghai, where high liquidity and the absence of market dominant dealers contrasts with London and New York where the bullion banks act as dealers.

Gold ETFs –Yesterday saw no purchases or sales of gold from the SPDR gold ETF but purchases no change in the Gold Trust. Their holdings are now at 853.684 tonnes and, at 208.41 tonnes respectively.

Since January 4th 2016, 250.346 tonnes of gold have been added to the SPDR gold ETF and to the Gold Trust.  Since January 6th 2017 49.64 tonnes have been added to the SPDR gold ETF and the Gold Trust.

Regards,

Julian D.W. Phillips 

GoldForecaster.com|StockBridge Management AllianceTo ensure you can benefit from the future higher gold prices we will see then, you need to hold it in a manner that makes sure it can’t be taken from you. Contact us at ultimategoldtrust@stockbridgemgmt.com to buy physical gold in a way that we feel, removes the threat of it being confiscated. We’re the only storage company that offers that!

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Global Gold Price (1 ounce)

Today

Yesterday

Franc

Sf1,201.94

Sf1,207.15

US

$1,252.80

$1,250.80

EU

€913.58

€1,108.96

India

Rs.80,987.26

Rs. 80,739.14


|
Data and Statistics for these countries : Georgia | Venezuela | All
Gold and Silver Prices for these countries : Georgia | Venezuela | All
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Julian Philips' history in the financial world goes back to 1970, after leaving the British Army having been an Officer in the Light Infantry, serving in Malaya, Mauritius, and Belfast. After a brief period in Timber Management, Julian joined the London Stock Exchange, qualifying as a member. He specialised from the beginning in currencies, gold and the "Dollar Premium". At the time, the gold / currency world exploded into action after the floating of the $ and the Pound Sterling. He wrote on gold and the $ premium in magazines, Accountancy and The International Currency Review. Julian moved to South Africa, where he was appointed a Macro economist for the Electricity Supply Commission, guiding currency decisions on the multi-Billion foreign Loan Portfolio, before joining Chase Manhattan the the U.K. Merchant Bank, Hill Samuel, in Johannesburg, specialising in gold. He moved to Capetown, where establishing the Fund Management department of the Board of Executors. Julian returned to the 'Gold World' over two years ago and established "Gold - Authentic Money" and now contributing to "Global Watch - The Gold Forecaster".
WebsiteSubscribe to his services
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