Silver Market Morning: Aug-15-2016 -- Gold and silver prices still consolidating!

Gold Today –Gold closed in New York at $1,334.60 on Friday after Thursday’s close at $1,337.90. London opened at $1,341.80.

- The $: € was slightly weaker at $1.1168 from $1.1156.

- The dollar index fell slightly to 95.65 from 95.83 Friday.

- The Yen was slightly weaker at 101.07 from Friday’s 101.04 against the dollar.

- The Yuan was weaker at 6.6459 from 6.6440 Friday.

- The Pound Sterling was weaker at $1.2924 down from Friday’s $1.2956.

Yuan Gold Fix

Shanghai again turned out to be higher than New York’s close but this time without any exchange rate influence as the Yuan was relatively steady. London followed Shanghai this time too, opening just slightly lower than Shanghai’s close.

As the time approaches when the Yuan becomes one of the world’s ‘hard’ currencies it is meeting the definition of being widely traded in the global monetary system. Just to what extent remains to be publicized. Certain Capital Controls still persist but the silence on this ahead of the incorporation of the Yuan in the IMF’ Special Drawing Rights is deafening.

At the same time the discussions over the type of gold trading London will see in the future has, on one side, Goldman Sachs and the Chinese ICBC who are pressing for a more transparent system. No doubt if precise numbers we published on London’s gold trade, they would influence just where gold’s pricing power resides. [More in our newsletters – subscribe below].

LBMA price setting: $1,339.20 after Friday 12^th August’s $1,336.70.

The gold price in the euro was set at €1,198.90 up €0.50 from Friday’s €1,198.40.

Ahead of the opening in New York the gold price stood at $1,337.25 and in the euro at €1,196.32.

Silver Today –The silver price closed in New York at $19.69 on Friday down from $19.95 on Thursday. Ahead of New York’s opening the price was trading at $19.77.

Gold _{(very short-term)}

The gold price will consolidate, in New York today.

Silver _{(very short-term)}

The silver price will consolidate, in New York today.

Price Drivers

On Friday in New York there was a very big sale of gold from the SPDR gold ETF of over 12 tonnes. This prompts the question, “Has U.S. demand for the shares of the gold ETFs fallen away?’ The data out of the U.S. on the economy is weak telling us that while the economy is OK, it is not as strong as it needs be to invigorate growth. The rest of the world [with the exception of China] is also giving a poor showing. Against the backdrop of globally burgeoning debt, the conditions where even the U.S. investor discards his gold do not exist at present. Add to that the approaching ‘gold season’ and we do not expect to see the thundering herd leave its gold positions. Indeed demand from gold from the U.S. has not reached the point where it is a ‘thundering herd’. It has a long way to go before U.S. investors are well stocked with gold in their portfolios.

We have a couple or more weeks before the ‘gold season’ comes into play so the gold price will continue to consolidate.

Gold ETFs – In New York on Friday there were very large sales of 12.171 tonnes from the SPDR gold ETF but purchases of 1.65 tonnes into the Gold Trust. This left their respective holdings at 960.447 tonnes and 222.89 tonnes.

Since January 4^th this year, the holdings of these two gold ETFs have risen by 385.722 tonnes.

Silver –Silver prices were pulled back below $20 in line with the fall in gold prices after the heavy sale from the SPDR gold ETF. We wait to see whether New York will counter this as bargain hunters move in.

Regards,

Julian D.W. Phillips

GoldForecaster.com | SilverForecaster.com | StockBridge Management Alliance [Gold Storage geared to avoid its confiscation]

About GoldForecaster.com Service:

We focus on keeping our readers on top of the emerging Gold bull market with a global fundamental and technical overview. Members gain access to our comprehensive, weekly report with the latest Gold market news, price analysis, up-to-date portfolio along with coverage of other key markets. Economic and monetary topics are covered as well, along with many other influences that have an impact on the Gold market.

Try a $99 trial subscription and gain immediate access to the latest weekly Gold Forecaster Newsletter!