Silver Market Morning

Gold Today –New York closed at $1,154 down$7.30 as, for yet another day, the dollar continued to rise as the market remained dominated by currency issues. Asia lifted the gold price by $11 before London pulled it back to $1,160. London then Fixed the gold price at $1,161.25 up $2.50 and in the euro, at €1,094.899 down €1.157, while the euro was at $1.0606, up quarter of a cent. Ahead of New York’s opening, gold was trading in London at $1,159.00 and in the euro at €1,091.51.

Silver Today – The silver price closed at $15.50 down 18 cents. Ahead of New York’s opening it was trading at $15.63.

Gold _{(very short-term)} The gold price will look for a bottom, then consolidate in New York, today.

Silver _{(very short-term)} The silver price will look for a bottom then consolidate, in New York, today.

Price Drivers

There were no sales or purchases of gold from the SPDR gold ETF but a sale of 0.84 of a tonnes from the Gold Trust on Wednesday. The holdings of the SPDR gold ETF are at 753.037 tonnes and at 164.02 tonnes in the Gold Trust.

This morning has seen much more demand from Asia and a bounce in the gold price as well as in the euro. The signal for a jump in Asian demand will be the formation of a ‘bottom’, indicating prices have stopped falling. The fear of further price falls does deter Asian demand, but once that is removed the concept of ‘bargains’ takes over.

The euro has fallen from $1.40 from its peak to today’s $1.06 or 25%. The euro is the world’s second most important and used currency so a fall of 34 points against the sole global reserve currency is a game changer. Just look at the price changes of the Boeing aircraft compared to a European one. A 25% discount is hard to resist.

The Yen, in the top five global currencies, has fallen from 76 to a dollar to 121 to the dollar a fall of 46 points or 60% and this has made Japanese imported products so cheap they compete with Chinese products now. The U.S. will see a jump in its imports, fall in exports and an undermining of its Balance of Payments from now on. China has seen its currency rise against all other currencies except the dollar, so we fully expect at some point to see the Yuan ‘peg’ lowered against the dollar. So in Yuan, the gold price will jump at that time and China seeks to make its exports more competitive.

It takes no stretch of the imagination to see that we are close to a trade war. The world has been changed by currency values, not innovation or effort, but by manipulations through quantitative easing. Bear in mind this is undertaken to deflect deflation, another major threat to the global economy being fought off.

Subscribe to www.GoldForecaster.com

Silver– The silver price will accept a bottom in the gold price and stabilize.

Subscribe to www.SilverForecaster.com

Regards,

Julian D.W. Phillips for the Gold & Silver Forecasters