May 2010

The global price for gold yesterday achieved a new historical record of $1,234.5 per ounce.  It is simply not a peak for 2010 but a realization of futuristic forecast for the current year of $1,200 per ounce

To compare it this April, the gold’s price rose by 5.3% and the metal was traded then on record tariff of $1,176.40.  Analysts expected that if boundary of $1,175 per ounce to be achieved, a rise in prices to $1,200 can happen.

Rob McEwen, US Gold Corp CEO, said that in 2012 to 2014, the gold’s price can reach $5,000 per ounce.  He also added that the cause of gold price can be the weakening of the US dollar.

He Ruiyan, the head of research of Xiamen International Trade Futures Co. predicts that the price of gold can reach $2,000 before the end of the year.

In 2009, Deutsche Bank forecasted that the gold’s price would be at the level of $1,100 per ounce in 2010.  However, this was already surpassed last autumn.

Azerbaijan Business Center:

The price of gold surged higher on Wednesday morning, rising $13.62 to $1,212.50 per ounce.  The price of gold has rallied $46.20 off its low of just three days ago.  Stocks, commodities, and precious metals also rose higher in the market yesterday as risk appetites returned. 

The gold price has deteriorated lately as price declines soured investors’ outlooks for global economic growth and for their willingness to buy anything other than government bonds.

After hitting a low of $46.89, gold stocks staged a significant reversal yesterday afternoon where the ETF, Market Vectors Gold Miners (GDX) rallied 4.4% to close at $48.94 and up 2.7% on the day.  Barrick Gold, the world’s largest producer, also led the gold stocks higher.

Amid the ongoing sovereign debt crisis, researcher Echoing Sprott, believes that it investors will continue to hedge the instability and look for somewhere to hide outside of paper money.  The gold price will definitely benefit because of this and may continue to see gold reaching $1,500 per ounce this year.

Gold set a record climbing to a new peak of Rs.18,810 per 10 grams in New Delhi today on frantic buying for the ongoing marriage season amid a firming global trend.

A firming trend in overseas market continued to support gold in domestic markets here and its price in global market climbed for a third day as investors are looking for a safe haven from Europe’s debt crisis.

Standard gold and ornaments went up by Rs.150 to Rs.18,810 and Rs. 18,660 per 10 grams perspectively. Sovereign prices also went up by Rs. 75 to Rs. 14,600 per 8 grams.

The price surpassed the previous peak of Rs. 18,550 which was attained on December last year. The brisk buying by jewelers and stockists for the current marriage season, joined by investors and speculators was seen as the contributing factors for the new record.

According to Rakesh Anand, a Delhi jeweler, the metal might become more dear globally as the Europe debt crisis is yet to run its course.

The Hindu : Business News : Gold continues to set new records, climbs to Rs. 18,810:

Speculators are buying gold faster than what the world’s biggest producers can produce as analysts forecast a 26% rally that may extend the longest run of annual gains since at least 1920.

According to the data from UBS, exchange-traded products backed by bullion added 42.5 metric tons in the week of May 14 which was the most in 14 months. The largest mining nations including China and Australia averaged a weekly output of 42.3 tons last year. Prices have fallen to $1,189.75 from $1,249.40 an ounce on May 14 but traders, analysts, and investors surveyed by Bloomberg shows it will reach $1,500 at the end of the year.

According to Evan Smith from Global Investors Inc, all the turmol and problems we’ve seen in Europe is just another reminder that there’s a lot of value in gold as safe haven.

Gold from mines, which peaked in 2001, fell in five of the last eight years, data from GFMS show. The risk of gold bulls lies mainly on the economic growth, which should buoy the prospects of metals linked to industrial demand, such as copper and silver. Indeed, gold is favored by investors when the dollar weakens and inflation gains, but the metal can also advance to other times.

Gold being bought faster than it can be produced – thestar.com:

Turkey, the world’s third largest consumer of gold have more domestic scrap than imports as high global gold prices have pushed the market past a crucial tipping point in the country.

Scrap sales have gone 8-10 tonnes in the first few weeks of May although traders say sales tailed off once the price moderated to below $1,200 an ounce. According to Istanbul’s gold exchange data, gold imports during the first four months of 2010 dwindled to 1.17 tonnes.

Turkey was badly hit by the global financial crisis and as the country was affected and also had a recession. Imports of gold slumped to 37.6 tonnes in 2009 from 166 tonnes in 2008. The Turkish economy is expected to recover and the dealers see demand increasing if gold prices continue to slip back. As of May 24, the gold price in Turkey stood at 59.87 Turkish lira per gram, while the world spot price was $1,183 back from the record $1,248.95 earlier in May.

The price of gold dropped to as low as $1,174 an ounce in New York Thursday morning after hitting a record high of $1,249.

A number of factors contributed to the gold’s price drop including Germany’s move to ban naked short selling which triggered a return to heightened risk-aversion and frenzy of selling across the markets.

The fear spreading overt the impact of debt problems in the eurozone also affected gold’s price. It would be expected that the precious metal would be trading up in such an environment and would remain high but the dollar seems to be the go-to safe haven rather than gold at the present moment, but even the dollar took a hit later in the trading day Thursday.

Many see the gold prices moving further on the downside in the short term. However, bullish sentiment over the medium to long term still remains. Ongoing financial problems in the Eurozone will likely support the price of gold over the longer term and will probably increase its safe haven status.

Gold Price Takes a Beating with the Rest of the Markets | Gold Investing News:

After tumbling 4.3% last week, the gold price marginally traded higher last Sunday night and rose  $3.00 to $1,180.90 per ounce. Despite last week’s decline, the gold’s price is one of the few commodities that have managed to stay positive thus far in 2010. It has remained up 7.4% this year, while the US stock markets dropped last week.

Unlike the gold price, the Reuters/Jefferies CRB index is off 11.3% thus far in 2010, weighed down by economically sensitive commodities such as oil. The CRB slipped 2.3% last week and has brought 9.0% losses in May. Commodity currencies also were no exception to drop last week. The Australian dollar dropped 6.6% against its US counterpart to $0.827 which was a 10-month low. The Euro also dove to a four-year low last week at 1.214 against the US dollar before it rallied back above 1.25. The Euro however, still remains 13.9% down against the US dollar this year, while the gold price has appreciated 20.4% over the past six months. Gold mining stocks also have not done well, dropping precipitously alongside common stocks.

Gold futures went down in New York as an increase in the value of the dollar may curb demand at a time of increased metal sales. Sales of old jewelry and scrap gold on the other hand, have increase at the same times as investor demand gained, according to Walter de Wet, analyst of Standard Bank Pic in London. He also added that the investment demand is there but is seeing a decent physical selling of scrap metal in Asia.

Gold for delivery in June fell $4.40 of 0.4% to $1,149.60 an ounce at 8:19 am on the Comex in New York. Bullion for delivery also dropped 0.4% to $1,149.32. Assets in the SPDR Gold Trust rose 6.09 metric tons to record 1,146.22 tons yesterday. According to de Wet, Prices will probably average a record $1,200 an ounce in the 3^rd quarter. Gold in the morning fixing, used by some mining companies to sell their production, fell to $1,152.25 an ounce and fixed to $1,154.50 an ounce yesterday afternoon.

Gold Falls as Dollar, Scrap Sales Make Up for Investment Buying – BusinessWeek:

Gold appears to have run out of friends despite having what should be a conducive environment as gold prices continues to head lower in London during the morning trade.

Spot gold price is 0.78% lower at $1214 an ounce. According to Simon Denham at Capital Spreads, the 1250 hit yesterday is likely to remain high for some time to come as gold market runs out of momentum. He also said that states across the world are not moving into fiscal contraction and while there is obviously a lot more dollars/yen/pounds and euros around these days, this has to be equated with the fact that gold has now almost quintupled since Gordon sold off UK’s reserves

Gold price: 1250 a step too far – The Economy News – Economic news and Insight for the spread betting, CFD trading and investment community:

Both gold and silver prices rose over 1% in Asia on Monday before they fell to see modest losses in London. They also climbed back higher in early New York trade, but both fell back off to new session lows in late morning action. At the end of the day, gold rallied but silver closed with a loss of 1.5%.

Gold mining and silver equities in addition, fell over 3.5% by about noon EST before they rallied back higher in the afternoon trade but still ended with over 2% losses. The gold price in Euros however, hit a new record in intraday and finished €995 an ounce driven by persistent fears over debt problems in Europe.

Gold & Silver Prices Volatile as Euro Bounces from 4-Year Low | Gold News: