Gold Price Jumps 1.8% to Break $1200, Euro Price at 8-Week High as Shanghai's International Gold Volume Leaps to Record

IMG Auteur
 
Published : April 01st, 2015
582 words - Reading time : 1 - 2 minutes
( 0 vote, 0/5 )
Print article
  Article Comments Comment this article Rating All Articles  
0
Send
0
comment
Our Newsletter...
Category : Market Analysis
GOLD PRICES jumped back above $1200 per ounce for Dollar investors Wednesday afternoon in London, adding 1.8% from the day's low as Euro prices hit 8-week highs after US jobs data came in well below consensus forecasts.
The private-sector ADP report – a precursor to Friday's official Bureau of Labor Statistics' estimate of non-farm payrolls – said net hiring totaled only 189,000 last month, badly missing the Street's 225,000 expectation.
Data for both US construction spending and manufacturing activity then missed forecasts as well.
Longer-term interest rates fell, with 10-year US Treasury yields hitting the lowest level since early February at 1.86%.
New York's stock markets opened the day lower, while European shares followed Asia in rising towards the close.
"Given what we know today," said Richmond Fed president Jeffrey Lacker in a speech Tuesday, "a strong case can be made that the federal funds rate should be higher than it is now.
"Unless incoming economic reports diverge substantially from projections, the case for raising rates will remain strong at the June meeting."
But pushing back its forecast for a US rate rise from the current 0%, "A June rate hike would have exposed a weak gold price floor," says London market maker and LBMA Gold Price participant Barclays Bank, "whereas in September, physical demand tends to strengthen in light of seasonal buying in India."
A fall hike by the Fed should see physical gold demand from Asia help "buffer prices," Barclays concludes, but higher US interest rates will still "likely to lead to disinvestment."
"General theme continues," said a trading note from Standard Bank's London office earlier – "oversupplied commodities markets triggering reduction in 'diversification' and outright investments; and overall increase in shorts vs long liquidation."
But "following yesterday's sell off, China was back as a buyer today," says an Asian trading note from Swiss refining and finance group MKS. 
China's main wholesale gold price held $2.40 per ounce above comparable quotes for London settlement, some 90 cents below the average incentive offered to importers so far in 2015.
Trading volume in Shanghai's main domestic gold contract totaled only 60% of the last 6 months' average.
But trading in the international board's main contract – the iAu9999 contract launched last summer for foreign institutions to trade Shanghai-stored gold using the Yuan currency – jumped almost to the same level, rising from the last 5 weeks' average of 28% to equal 96% of the main bourse's contract volume, just shy of Monday's new record high in Yuan terms.
After waiving storage and dealing fees for international banks using the iSGE board for the first 6 months of this year, the "authorities continue to encourage trading by foreign institutions" in the new contracts, said Metals Focus director Nikos Kavalis at yesterday's London launch of the consultancy's 2015 gold yearbook, adding that foreign players will no longer have to transfer metal to the main domestic bourse.
Gold imports to China, however, made only a "sluggish start" to 2015 on Metals Focus' data, with the consultancy estimating the lowest Q1 inflows since 2012, down by more than 25% from the first 3 months of 2014.
Wednesday's weak US data meantime saw the Dollar little changed on the FX market, trading near a 1-week high to the Euro.
That let the gold price for Eurozone investors jump above €1115 per ounce, its highest level since 5th February.
You can receive your first gram of Gold free by opening an account with Bullion Vault : Click here.
Data and Statistics for these countries : China | India | All
Gold and Silver Prices for these countries : China | India | All
<< Previous article
Rate : Average note :0 (0 vote)
>> Next article
The London Gold Market Report is the daily market review from BullionVault, the world's largest physical gold and silver market for private investors. A full member of professional trade body the London Bullion Market Association, BullionVault publishes the LGMR every day that the market is open, bringing you insider comment and analysis from the very center of the world's $240 billion-a-day physical gold trade, and putting the latest gold price action into its wider financial and economic context. Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.
Comments closed
Latest comment posted for this article
Be the first to comment
Add your comment
Top articles
World PM Newsflow
ALL
GOLD
SILVER
PGM & DIAMONDS
OIL & GAS
OTHER METALS
Take advantage of rising gold stocks
  • Subscribe to our weekly mining market briefing.
  • Receive our research reports on junior mining companies
    with the strongest potential
  • Free service, your email is safe
  • Limited offer, register now !
Go to website.