Browsing all articles tagged with China
May
18

Gold Drop Further in Longest Losing Streak in Four Years

Precious metal knock down on Friday for a seventh straight session, in its greatest losing streak since March 2009 because the dollar strengthened and investors cut exposure to the gold fearing further drops and choosing equities instead.

Yellow metal has lost almost 6 percent of its value in the six sessions through Thursday as stocks added on the back of strong US economic statistics and on fears the Federal Reserve could end its bullion friendly bond buying program.

Spot gold was losing 0.34 percent at $1,380.91 per ounce by 0538 GMT, having plunge to a four-week low of $1,369.29 on Thursday as renewed liquidation in precious metal’s ETFs and a recent drop below the $1,400 per ounce level spooked investors.

The gold is down 17 percent for the year and is on track for its worst weekly turn down in a month. Holdings in SPDR Gold Trust, the world’s major gold-backed exchange-traded fund, knock down to their lowest in four years.

Traders and dealers said Physical demand was also quiet on Friday as consumers in the largest gold buyers, China and India, wait for prices to stabilize or fall further.

Brian Lan, managing director of GoldSilver Central Pte Ltd in Singapore said many people are waiting on the sidelines as they are expecting another fall.

Demand in India is being hurt by central bank curbs on gold imports. Limits on bank batch have hit supply and triggered a sharp jump in premiums.

Indian gold futures chop down 1.5 percent on Thursday, extending losses for a second straight session to their lowest level in almost a month in line with global markets.  Lan said buying in India had plunge considerably from Monday, which saw the celebration of Akshaya Tritiya, considered an auspicious day to buy metal.

Premiums for gold bars in Hong Kong the main supply of gold for China, strike record highs this week on supply constraints.

Yellow metal demand knock down 13 percent to a three year low of 963 tonnes in the first quarter because rising jewelery demand and strong appetite for coins and bars failed to offset a sharp fall in investment, the World Gold Council says.

SPDR said holdings knock down 0.55 percent to 1041.42 tonnes on Thursday, the weakest in four years.

US gold future for June delivery was down 0.52 percent at $1,379.70 per ounce.

May
1

Yellow Metal Edges Down, Investors Cautious Ahead of Fed

Yellow metal ticked lower on Wednesday on a shortage of physical buying and as investors waited to see if the US Federal Reserve sticks to its stimulus programme to spur the economy, which may lift the metal’s appeal as a hedge against inflation.

Doubts that central banks money printing to buy assets will stoke inflation have been a key driver in boosting precious metal, which rallied to an 11-month high previous October following the Fed announced its third round of aggressive economic stimulus.

The Fed’s policy making committee ends its conference later in the day with a statement that could reflect recent weak economic statistics. Investors also await Friday’s non-farm payrolls data which will signal the longer term predictions for the Fed’s monetary stimulus.

Edward Meir, a metals analyst at futures brokerage INTL FCStone said that accommodative policies are generally seen as supportive for bullion, however as the events of the last few weeks have demonstrated, gold does not always move in lockstep with simple expansion in money supply.

In its place, it seems to pick up steam either as a result of disorder in the financial markets or on the back of higher inflation readings, neither of which seem to be dominant at this particular time.

Gold dropped $1.89 per ounce to $1,474.71 by 0602 GMT, with the market torn between expectations that the Fed will keep its current policy and daily outflows from exchange traded funds, as investors cut their exposure.

US gold futures for June delivery stood at $1,474.20 per ounce added $2.10.

SPDR Gold Trust, the world’s biggest gold backed exchange traded fund, said its holdings dropped 0.19 percent to 1078.54 tonnes on Tuesday, their lowest since September 2009.

However gold has recovered more than half of its $225 loss incurred among April 12 and 16, boosted by strong physical demand, especially in top gold consumers China and India.

The longer term trend has been broken to the downside. This fact is important as in a downtrend the default move of a price is lower in the absence of convincing fundamentals. With fundamentals only neutral, we think certain risk still persists.

Credit Suisse in a report said that with investment flows negative however monetary policy supportive, we consider a neutral fundamental rating is the most appropriate one. In contrast to neutral fundamentals, technical indicators are clearly negative.

Singapore and Hong Kong were closed for a holiday. A rush in buying of gold bars following the recent plunge in prices has led to tight physical supply in Asia.

In other markets, the US dollar eased on Wednesday as investors warily awaited the result of the US Federal Reserve’s policy meeting, although expectations the European Central Bank will cut interest rates on Thursday capped the euro.

Apr
26

Precious Gold Increased More Than 1 pct, Heads for Best Week in 1-1/2 years

Yellow metal was headed for its greatest weekly addition in one and a half years following increasing more than 1 percent on Friday as a mid-month plunge in prices prompt bargain hunting and a surge in physical buying across Asia.

Gold still attracted buying even though the price had bounce back more than $100 since declining to a two year trough of about $1,321 previous week, with dealers reporting a shortage in gold coins, bars, nuggets and other products.

Ronald Leung, chief dealer at Lee Cheong gold Dealers in Hong Kong said that there’s panic buying. Everybody is buying gold. It still has a chance to go up to $1,500 and maybe a bit more. $1,525 is then the big barrier.

It was floating to be up more than 5 percent for the week. Gold posted its biggest daily climb since June last year on Thursday, however was still down 12 percent this year.

Precious metal was up $7.30 per ounce at $1,474.29 by 0408 GMT, off an initial high of $1,484.81 its strongest since April 15.

It’s not simple to go back down to $1,400 as long as the physical market is still firmed. The thing is that there are no immediate stocks.

US gold futures for June delivery climbed as high as $1,484.80 per ounce.

International Monetary Fund said on Wednesday, bullion was also supported by prediction of more central bank buying following Russia and Turkey raised their gold reserves in March, increasing their holdings ahead of a spectacular plunge in prices this month.

Premiums in Singapore stayed at their highest since October 2008 at $3 per ounce to the spot London prices on demand from Indonesia, India and Thailand.

Premiums for gold bars in Hong Kong climbed to at their highest level since October 2011 this week, at rise to $3 an ounce to spot London prices, partly as of an increase in buying interest from China, the world’s second largest consumer following India.

The Indonesians have told me they should begin selling at above $1,450, however they are actually buying some this morning, while the amount is not great. Local demand in Thailand is still good, he also see a pickup in demand for silver.

Apr
24

Gold Plunge on Stronger US Greenback, ETF outflows

Yellow metal knock down more than 1 percent on Tuesday as a stronger US dollar put pressure on prices and as the outflow from the world’s leading gold exchange-traded fund known as ETF accelerated and accentuated an investor shift towards equities and other assets.

At the midsession, bullion along with markets in stocks, oil, bonds and other commodities, was roiled temporarily by a bogus report of explosions at the White House. Bullion pulled up off its lows on the fake report.

The early turn down retraced some of gold’s 1.6 percent rally from a day earlier, which was encouraged by strong physical purchases.

Heraeus Precious Metals Management metals trader David Lee said that he believe the whole commodities space came off because of the weak PMI out of Europe and the weak PMI out of China, particularly Germany. That combination is dragging everything from silver to copper to platinum and palladium down. And yellow metal is going down in sympathy as it’s part of the basket.

Traders stated gold prices chop down to session lows in overnight dealings when the US dollar firmed in reaction to weaker April manufacturing statistics from both Germany and China, and then lingered at the lower levels.

Shortly following 1 p.m. (1700 GMT), precious metal prices pulled up off their lows, US government debt prices surged briefly and stocks knock down sharply following a false tweet from the Associated Press stated there had been two explosions at the White House and that President Barack Obama had been injured.

Gold knock down 1.4 percent to a session low of $1,405.44 per ounce and had pared losses to $1,412.70 by 3:14 EDT (1914 GMT), off 0.87 percent. Precious metal has dropped 15 percent this year.

US gold futures for June delivery were losing 0.61 percent at $1,412.30 per ounce.

Traders said gold’s retreat off the one week high it reached a day earlier reproduce investor nervousness regarding holding on to precious metal positions for long. Many yellow metal bulls were caught by surprise a week ago when bullion slid to its biggest-ever daily loss in Greenback terms.

Gold was also under pressure from a strong dollar and bounce back of equity markets following sales of new US single family homes climbed in March, indicating the housing market recovery remains on track.

Commerzbank analyst Carsten Fritsch said that bullion is lower as well as other commodities, including base metals oil and crude, which knock down following weaker than expected economic data out of China and Europe, which gave a boost to the dollar.

In other markets, copper knock down to an 18-month low and crude oil was down nearly 1 percent because data revealed a slowdown in business activity in Germany and China in April. The figures heightened worries over global growth.

Apr
18

Precious Metal Slump Tipped to Fuel China’s Acquisition Follow

The fall down in gold prices is set to rekindle bullion mining takeovers as Chinese companies, private equity funds and sovereign wealth and hedge funds step in to rescue cash strapped small and mid sized miners.

A seven-fold climbed in yellow metal prices between 2001 and 2011 spurred a run of yellow metal mergers and acquisitions. Activity knock down last year as major miners digested some big buys and smaller players held out for better offers, with global gold M&A dipping to $14.6 billion from $43.3 billion in 2011.

Precious metal miners in China, the world’s largest producer, have been chasing mines and listed companies in a bid to develop and match the biggest global producers, like Barrick Gold Corp .

John McGloin, executive chairman of Africa-focused miner Amara Mining that this might be the final shoe to fall that makes some people think there’s no way they are able to finance myself going forward, so they got to consider more seriously regarding my investors and give their investors a return by putting things together with people that have got the cash.

However that is expected to pick up again this year as a 15 percent plunge in precious metal prices this month forces smaller miners, particularly those with high-cost production or single assets, to seek partners to stave off a cash crunch.

With major yellow metal miners like Newcrest Mining and Barrick Gold under pressure to rein in capital spending, slash costs and fix mine problems they are more probable to be spinning off assets rather than chasing acquisitions.

An adviser familiar with the sector, with things so badly beaten up, it is an opportunity for Chinese companies who will only have one or two other bidders for any asset.

That leaves the door open to the Chinese as well as cashed up sovereign wealth funds and hedge funds and private equity, to fill the gap.

Mike Elliott, global metals and mining leader at Ernst & Young said if $1,300 gold stays in place into the second half of this year, then you’ll found to see sellers resetting their price prospect.

Gold future for June delivery knock down $6.4 or 0.5%, to $1,375.80 per ounce during the Asian trading hours. They finished Wednesday down $4.70 or 0.3%, at $1,382.70 per ounce on the Comex division of the New York Mercantile Exchange.

Apr
15

Gold slump for 2nd day, Week China Data Fuels Recovery Uncertainty

Precious metal sank to its weakest in two years and because investors sold off commodities for a second day on Monday, concerned that central banks will pull the plug on stimulus and as disappointing Chinese statistics signaled a setback for the global economic recovery.

China’s economy grew 7.7 percent in the first quarter undershooting market prospect for an 8.0 percent expansion and annoying investors hoping the world’s No. 2 economy would rebound following posting its weakest growth in 13 years in 2012.

The Chinese statistics comes following soft US retail sales and consumer sentiment numbers lift worries regarding the economic recovery momentum in the world’s top economy, driving down commodities and equities on Friday.

Yellow metal fell more than 3 percent, following sliding 5.3 percent on Friday, as investors further cut their gold holdings on concern that central banks are bent on halting stimulus measures this year, cutting precious metal’s appeal as a hedge against inflation. Holdings on global gold exchange traded funds strike their lowest in more than a year.

Spot gold hit a session trough of $1,427.14 per ounce, its lowest since April 1, 2011. Spot gold climbed as high as $1,495.16 early in the session, earlier than a sell-off in US futures dragged it down.

Vishnu Varathan, market economist at Mizuho Corporate Bank in Singapore said that there are questions concerning the trend of bottoming in China’s economy and whether it can re-accelerate over 8 percent this year in a sustainable way.

China’s weaker than predicted GDP growth is backed by slower boost in industrial production and fixed-asset investment, despite strong lending growth in March as previous week’s data indicated.

Varathan said that demonstrate how China’s economy looks a bit uneven and risks in the property and shadow banking sectors might be mounting. What this means is that policymakers in China have less autonomy to spur the economy because they’ll be mindful of these risks.

Gold future for June delivery fall $90.20 or 6%, to $1,411.00 per ounce. Gold last week lost 4.7%.

Apr
10

Gold Added on Japan Policy, Firm Equities May Weigh

Gold climbed up on Wednesday because Japan’s aggressive monetary easing policy enhanced bullion’s appeal as a hedge against inflation, while gains may be capped as stronger equities lure buyers seeking superior returns.

Brian Lan, managing director of GoldSilver Central Pte Ltd said that what the Fed really releases in the minutes tonight will influence the direction of gold. Yellow metal needs to test $1,600 before we see it trading in a higher band. If it does not there might still be a downside risk.

Investors are shifting their focus to minutes from the previous US Federal Reserve monetary policy conference for insight on the Fed’s bullion friendly bond buying programme, which sent prices to an 11 month high in October previous year.

It has fall about 5 percent so far this year, following posting annual additions in the past 12 years.

Investors will be looking out for any reveal of quantitative easing. The decision on whether the Fed will continue to print money, limit the print or slowly ease it out will definitely drive gold’s prices.

Precious metal had gained $2.14 per ounce to $1,586.84 by 0610 GMT, following hitting $1,590 on Tuesday, its highest since April 2.

Gold futures on Tokyo Commodity Exchange moved towards a ever high at 5,081 per ounce yen a gram strike in February as of a weak yen, however the climb in TOCOM failed to spur more additions in cash gold.

The addition in Tokyo gold futures weighed on yellow metal bars offered to investors. Precious metal were at discounts of 75 cents to spot London prices in Tokyo, against premiums of 50 cents previous week.

South Korea said it has invite China, North Korea’s only major supporter, to restraint the hermit state and has raised its surveillance following the North moved at least one long-range missile in readiness for a possible launch.

Gold future for June delivery were losing 90 cents, or 0.1%, in Asian trading hours to $1,585.80 per ounce. US gold for June delivery were stable at $1,587.00 per ounce.

Apr
1

Yellow metal Climbed on China PMI Figures, Flirts with $1,600 per ounce

Precious metal firmed on Monday, as signs that China’s economic revival was attaining traction could enhanced demand for commodities, however prices could be capped by doubts regarding the debt crisis in Cyprus bank and the weakness of the euro versus the US dollar.

Yellow metal rallied to a 1-month high in March on concerns regarding fiscal stability in Europe following the European Union gave Cyprus an ultimatum to lift billions of euros it needs to settle a bailout deal or face a possible exit from the currency zone.

Strain in the Korean peninsula has yet to generate a rush in purchases from investors in Asia, however a full-scale conflict among the two Koreas could potentially increased yellow metal’s safe haven appeal in times of uncertainty.

Bullion hit an intraday high of $1,600.81 per ounce and traded at $1,597.76 by 0647 GMT, up $1.59. Gold ended the quarter down around 4 percent following stock markets rushed and the euro stayed weak as compare the dollar.

Brian Lan, managing director of GoldSilver Central Pte Ltd said that investors are in an uncertain market, usually a strong PMI data from China would tend to draw investors towards stocks and not support precious metal prices, however this time investor perceive a reverse. The North Korea stress is adding to the market doubt’s.

Physical buying by the retail investors during price plunged have been observed and this helped to support prices, which should increased to $1,600 per ounce. If thing goes well it look’s like a bullion could move on to a higher trading range of $1,620 per ounce.

The euro fall to approach a four month low on concerns regarding the spillover from Cyprus bailout conditions, as the Australian dollar was tripped up following statistics showed a slower than expected bounce back in Chinese factory activity in March.

Mar
6

Gold Float’s around $1,575 per ounce, Bank’s Intrested In Buying

Precious Gold float around $1,575 per ounce during the Wednesday’s trading session, suffering form a recent range as a strong stock market performance drew the attention of investors who have become more certain in the economic growth position.

South Korea’s central bank stated on Wednesday it purchased 20 tonnes of yellow metal in February in the fifth purchase of the gold in less than two years, captivating total holdings to 104.4 tonnes.

Some other major banks are breaking away from the agreement for continued addition in yellow metal prices as an initial return to growth of the global economy has damaged the argument for holding the gold.

Holdings of SPDR Gold Trust, the world’s greatest gold backed exchange traded fund, fall for an eleventh successive session to a 16-month low of 1,244.855 tonnes on March 5. The fund had observed an outflow of 105.965 tonnes so far this year as compared with a 96.25 tonne inflow in 2012.

The US Congress is moving swiftly to pass legislation funding the federal government during Sept. 30, while Senate leaders on Tuesday expressed eagerness to prevent any threat of agency pack up when money runs out on March 27.

Spot gold climbed up 0.1 percent to $1,577.05 per ounce by 0037 GMT, floating within a recent range among $1,564 to $1,587 per ounce. US gold was also increased 0.1 percent to $1,576.80 per ounce.

Peter Hug, global trading director at Kitco Metals said that some superior demand for physical gold from Asia and bright economic stimulus measures from China are prompting bargain hunting and short covering in yellow metal and silver markets.

Gold future for April delivery increased $3.20 to $1,578.10 per ounce in Asian trading session.

Feb
23

Shinzo Abe Declared to stimulate Japanese economy, Observe No Escalation With China

Shinzo Abe, Japanese Prime Minister told Americans on Friday that he is back and so is Japan and declare to get the world’s third biggest economy rising again and to do more to boost security and the rule of law in an Asia roiled by territorial disputes.

Abe had definite words for China in a policy speech to a top Washington think tank, however  tempered his comments by saying he had no desire to rose a row over islet in the East China Sea that Tokyo controls and Beijing claims.

Following conference US President Barack Obama on his first trip to Washington since taking office in December in a exceptional comeback to Japan’s top job, he said he told Obama that Tokyo would handle the islands concern in a calm manner.

Worries rushed in 2012, lifting fears of an unintended military happening near the islands, identified as the Senkaku in Japan and the Diaoyu in China. Washington stated he islets drop under a US Japan security pact, however it is excited to avoid a clash in the region.

Abe told he and Obama decided that they have to work together to uphold the autonomy of the seas and also that they would have to produce a region which is governed based not on force however based on an international law.

Abe, whose concerned first term ended following just one year when he unexpectedly quit in 2007, has declared to stimulate Japan’s economy with a mix of hyper easy monetary policy, big spending, and structural restructuring. The hawkish leader is also enhanced Japan’s defense spending for the first time in 11 years.