Wholesale London prices to buy gold rose
1.3% Thursday morning in London, briefly rising above $1,590 per ounce as
world stock markets also rallied.
prices rose faster still, gaining
2.2% from Wednesday's low to reach $27.55 per ounce.
The euro currency meantime failed to rise above $1.23 for the fourth time
in a week, however, and Spain was forced to pay 5.2% per year to raise new
2014 loans – a rise in funding costs from 4.3% at the last time of
asking in June.
Lawmakers in Berlin were due Thursday lunchtime to vote on the euro
zone's €100 billion credit line to Madrid, under which German tax
payers will guarantee 30% of the package.
German debt meanwhile continued to pay new investors less-than-zero as prices
rose further, squashing the yield on Berlin's 2-year Bunds down to minus
Consumer price inflation in Germany was last seen at 1.7% per year. Brent
crude oil today rose to a swven-week high above
$107 per barrel – the highest level since May when priced in the single
"The range in [dollar prices to buy gold ]
is converging," writes Russell Browne at bullion bank and London
market-maker Scotia Mocatta in his latest technical
"While a bearish trend has been in force since late February, trend
momentum is weak. [That range] is currently defined by $1,554 support and
Drawing a four-year uptrend from the base of Oct. 2008 straight to May
2012, however, "Gold on the weekly chart is heading back down towards
the 2008-12 uptrend line at 1559," reckons Axel Rudolph, technical
analyst at Commerzbank.
"Sideways consolidation should soon come to an end with a break
lower being around the corner."
Over in Asia today, "People are buying and selling [gold] when
prices move ten or twenty dollars," Reuters quotes a Singapore dealer.
Such two-way traffic means "We remain range-bound," the dealer
says, forecasting that "People are not going to be very hungry for
physical materials" until the return of festive demand from India later
in the year.
Although the India Meteorological Department says that the current
monsoon should improve as August begins – boosting potential incomes
for rural consumers to buy gold
– "Looking at the current scenario of monsoon, I don't
expect much pick-up from here," one Kolkata gold
wholesale, Harshad Ajmera
of JJ Gold House, is quoted today by the Business Standard.
Overtaking India in early 2012 as world #1 for demand to buy gold, China is looking to develop its domestic
gold market, a report claimed in the Wall Street Journal on Wednesday, by
encouraging bank-to-bank wholesale trading.
Aiming to launch on 31 August, the move is "a bid help Beijing gain
better pricing power amid growing appetite for commodities such as
gold," says the WSJ.
China is already the world's #1 gold
mining producer nation. Its banks will deal directly with each
other, rather than over a formal exchange, says the WSJ's
source, thus mimicking the London bullion market, current center of wholesale
"Trading has been quite quiet and dull," says one London
market-maker in a note this morning.
"Gold is caught into the summer doldrums, and I think the Olympic
Games will take their toll on the trading flows."
London commuters are being repeatedly warned to expect long delays when
the Games – held near the Canary Wharf financial district – begin
a week tomorrow.