Gold Today –New York closed down at $1,751.30 yesterday down $10. Asia and London took it slightly higher before it was Fixed at $1,755.25 down $8.50 on yesterday morning and in the euro at €1,365.316 down €5.50. The euro stood at the same level as yesterday at $1.2854. Ahead of New York’s opening gold stood at $1,755.40 and in the euro at €1,365.54.
Silver Today – Silver closed at $33.91, up 20 cents in New York. London lifted it up to $34.04 this morning where it held ahead of New York’s opening.
Gold (very short-term)
Gold should consolidate, today in New York, following the euro’s moves.
Silver (very short-term)
Silver should consolidate, today in New York, following the euro’s moves.
Price Drivers
Gold & Silver – We are now seeing physical demand lifting from Asia, but from China. Chinese demand is of a completely different nature to gold demand from India. It is simply a matter of what disposable income is available to buy it with. There is little legal physical demand from India, which remains supplied by local sales. The recent jump in prices also helped sideline Indian demand as those investors hope that prices will pull back. We reiterate that Indian demand will never go away. Even local sales will slow to a trickle, once prices find a stable floor. The U.S.$-Rupee cross rate has fallen to 53.5 from 55.5 earlier in the month. Gold prices in the Rupee have declined from the high of Rs.97,503/oz on 13 September to today’s Rs.93,562.82. If this holds…..
Back to the Eurozone and to Spain where the markets remain unhappy with their situation and where Spanish 10-year yields briefly mounted the 6% level. Spain has warned that GDP for the third quarter will decline “at a significant rate”. Now add to this the many regions asking government for a bailout [the latest is Castillia-La Mancha – Don Quixote country] which needs a billion dollars too. We are waiting for the reaction to the new austerity measures there. We think of Argentina, who abandoned the U.S. dollar as its currency when it felt that it just could not justify, in balance of payment terms, how it could continue to be linked to the strong dollar so it returned to the weak Peso. It caused havoc among savers but the country is still functioning well enough. [To follow our weekly commentary, please subscribe to our newsletters at www.GoldForecaster.com and www.SilverForecaster.com]
Silver – Again shows marginally more strength than gold on the day. Because it is moving as money against currencies expect it to continue to follow gold’s moves still.
Regards,
Julian D.W. Phillips for the Gold & Silver Forecasters
About the author
