Wholesale prices to buy gold rose
to seven-session highs in London on Thursday morning, touching $1,726 per
ounce even as new data showed US employment rising at its fastest pace since
The private-sector ADP payrolls report said the US
added 158,000 jobs in October. Earlier data from the manufacturing sector in
China, the world's #2 gold consumer, showed its
slowdown to be easing.
However, "Over 17% of survey respondents reported
a fall in the volume of new export orders," said the new Purchasing
Managing Index report from HSBC/Markit Economics,
"and just under 10% noted an increase."
Two-thirds of Chinese businesses reporting quarterly
results to the stock market have seen a sharp rise in unpaid bills according
to the Financial Times.
The People's Bank of China has this week pumped a
record $60 billion-worth of liquidity into its domestic money market.
"Gold has been finding support on approach of $1,700," says today's note from Standard Bank's
"Our Standard Bank Gold Physical Flow index has risen substantially in the past few days," says
Standard, with demand to buy gold in Asia and India "pick[ing]
Looking further ahead, and "supported by the
continual income growth of [China's] emerging middle-income class, investment
as well as gold products will benefit," says
Albert Cheng, managing director for the Far East at market-development
organization the World Gold Council.
"The longer-term growth of China's economy remains
The state-owned research group Antaike
meantime forecasts that China's demand to buy silver will
grow by 10% in 2013 to hit new record levels.
Alongside a large forecast for silver investment
demand, the solar-panel industry is flagged as a key driver.
Back in Thursday's action, major-economy government
bond prices slipped, nudging interest rates higher as Italian and Spanish
bond prices rose, reducing their interest rate.
Silver extended what one analyst called Wednesday's
"impressive advance" by reaching 2-week highs above $32.65 per
"We look for [gold price] support in the $1660
area," says a note from Barclays Capital, "to underpin a move
higher toward the $1800 highs."
"Historically gold performs strongly in
November," says a note from Commerzbank, "with monthly returns over
the past 30/40 years around 1.40% – the second strongest month of the
Slipping 3.2% from the end of September, prices to buy gold
just put in their first monthly drop since May and their worst October since
2008's plunge of 17.4%.
Commodities overall also delivered their worst monthly
returns since May, losing 4.1% in October on the S&P index of 24 natural
resources and unwinding the last of 2012's gain to date.
Global stock markets lost 0.6%, says Bloomberg. Bonds
of all kinds gave a positive return.
Silver prices lost 7.1% against the US Dollar. But
while last month's sales of silver Eagles by the US Mint slipped 3.1% from September,
they hit a new October record at 3.15 million ounces.
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Adrian Ash is head
of research at BullionVault – the secure, low-cost gold and silver market for
private investors online, where you can buy physical gold today vaulted in Zurich on $3 spreads and 0.8% dealing fees.
(c) BullionVault 2012
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