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Today’s AM fix was USD
1,679.00, EUR 1,313.05, and GBP 1,050.82 per ounce.
Friday’s AM fix was USD 1,708.25, EUR 1,325.77, and GBP 1,061.29 per
ounce.
Silver is trading at $31.05/oz, €24.39/oz and
£19.51/oz. Platinum is trading at $1,550.32/oz,
palladium at $597.38/oz and rhodium at $1,070/oz.
Gold dropped $35.70 or 2.08%
in New York on Friday and closed at $1,678.00. Silver hit a low of $30.789
and finished with a loss of 4.01%. Gold and silver were down nearly 2% and 3%
on the week.
Cross Currency Table – (Bloomberg)
Gold edged up a bit on
Monday, limiting the fall after the better than expected US jobs number sent
the yellow metal downward to a two month low.
If the US Fed doesn’t
need to embark on more stimulus measures this may limit the yellow
metal’s appeal with investors who see continuous money printing by
central banks as increasing inflation and debasing currencies.
The US dollar limited
gold’s rebound as it hit its highest in 2 months as investors
parked money there before the US election.
This week there is an ECB
policy meeting on November 8th and also a key gathering of the Chinese
Communist Party.
US Economic highlights
include ISM Services at 1500 GMT today. Wednesday’s data is Consumer
Credit, Thursday Initial Jobless Claims and the Trade Balance and Friday
Export & Import Prices, Michigan Sentiment, and Wholesale Inventories are
published.
Turkey’s trade deficit
has been shrinking and the country has enjoyed the best bond rally in the
emerging markets this year due in part to the contributions of airline
passengers transporting gold in their baggage.
Statistics from
Istanbul’s 2 main airports show $1.4 billion of precious metals were
registered for export in September.
XAU/USD Currency, 1 Year – (Bloomberg)
Iran is Turkey’s
largest oil supplier and Turkey has been paying for the oil not only with
liras but also with gold bullion. Turkey exported $11.7 billion of gold and
precious metals since March, when Iran was barred from the Society for
Worldwide Interbank Financial Telecommunication, (Swift) making it nearly
impossible for Iran to complete large international fund transfers. Of the
$11.7 billion, $10.2 billion or 90% was to Iran and the United Arab Emirates,
according to data on Turkey’s state statistics agency’s website.
Turkey’s current
account deficit is second in the world at $77.1 billion or 10% of GDP while
the US currently holds the top spot.
The problem with Turkey
switching from a net importer to a net exporter of gold bullion this year is
that the foreign trade data is misrepresented. Turkey’s use of precious
metals is a key factor to help turn around its nation’s current junk bond
rating status.
We mentioned before the
government’s efforts to move the $302 billion in privately held gold,
into government banks to increase the money supply in the economy.
“October data will be
very critical” as the US urged Turkey not to export gold to Iran or the
UAE, “which means indirectly to Iran,” Ozgur
Altug, chief economist at BGC Partners in Istanbul,
said in an e-mailed report yesterday.
The increase in precious
metal exports accounted for three quarters of the 14% one year gain in total
exports in the first nine months, Gulay Girgin, chief economist at Oyak
Securities in Istanbul, said in an e-mailed report yesterday.
“If you look at
Turkey’s trade figures without gold, it doesn’t look that
great,” Gizem Oztok
Altinsac, an economist at Garanti
Yatirim, the investment unit for Turkey’s
biggest bank, said by phone yesterday. “I think the analysts are paying
a lot of attention to this, but at the end of the day, the bottom line is the
current-account deficit, and that’s getting better.”
For breaking news and
commentary on financial markets and gold, follow us on Twitter.
NEWS
Gold edges higher as dollar retreats
– Market Watch
Gold firms after jobs report sparked sell-off
- Reuters
Hedge Funds Reduce Bullish Bets Most in Five Months
- Bloomberg
Gold Traders Most Bullish in 10 Weeks on Stimulus
- Bloomberg
COMMENTARY
Bundesbank Continues Golden Damage Control
– Zero Hedge
Election outcome will have no impact on the price of
gold – The Daily Reckoning
Keiser: 'Barack Obama is clueless. Mitt Romney will
bankrupt the country' – The Independent
The Great Precious Metals Managed Retreat
– Resource Investor
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