Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
It's Five Nights at Freddy's Again! - 12th Jan 25
Squid Game Stock Market 2025 - 5th Jan 25
Stock Market Bubble Drivers, Crypto Exit Strategy During Musk Presidency - 27th Dec 24
Gold Stocks’ Remain Exceptionally Weak Even as Stocks Rise - 27th Dec 24
Gold’s Remarkable Year - 27th Dec 24
Stock Market Rip the Face Off the Bears Rally! - 22nd Dec 24
STOP LOSSES - 22nd Dec 24
Fed Tests Gold Price Upleg - 22nd Dec 24
Stock Market Sentiment Speaks: Why Do We Rely On News - 22nd Dec 24
Never Buy an IPO - 22nd Dec 24
THEY DON'T RING THE BELL AT THE CRPTO MARKET TOP! - 20th Dec 24
CEREBUS IPO NVIDIA KILLER? - 18th Dec 24
Nvidia Stock 5X to 30X - 18th Dec 24
LRCX Stock Split - 18th Dec 24
Stock Market Expected Trend Forecast - 18th Dec 24
Silver’s Evolving Market: Bright Prospects and Lingering Challenges - 18th Dec 24
Extreme Levels of Work-for-Gold Ratio - 18th Dec 24
Tesla $460, Bitcoin $107k, S&P 6080 - The Pump Continues! - 16th Dec 24
Stock Market Risk to the Upside! S&P 7000 Forecast 2025 - 15th Dec 24
Stock Market 2025 Mid Decade Year - 15th Dec 24
Sheffield Christmas Market 2024 Is a Building Site - 15th Dec 24
Got Copper or Gold Miners? Watch Out - 15th Dec 24
Republican vs Democrat Presidents and the Stock Market - 13th Dec 24
Stock Market Up 8 Out of First 9 months - 13th Dec 24
What Does a Strong Sept Mean for the Stock Market? - 13th Dec 24
Is Trump the Most Pro-Stock Market President Ever? - 13th Dec 24
Interest Rates, Unemployment and the SPX - 13th Dec 24
Fed Balance Sheet Continues To Decline - 13th Dec 24
Trump Stocks and Crypto Mania 2025 Incoming as Bitcoin Breaks Above $100k - 8th Dec 24
Gold Price Multiple Confirmations - Are You Ready? - 8th Dec 24
Gold Price Monster Upleg Lives - 8th Dec 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold "Facing Competition from Stock Market" for Investment Dollars

Commodities / Gold and Silver 2013 Mar 14, 2013 - 05:47 PM GMT

By: Ben_Traynor

Commodities

GOLD dropped below $1580 per ounce Thursday morning, while gold in Sterling and Euros fell back below £1060 and €1225 an ounce respectively, extending losses from a day earlier that following stronger-than-expected US retail sales data.

Like gold, silver drifted lower this morning, dipping below $28.60 an ounce, while other commodities were broadly flat and European stock markets ticked higher.


US, UK and German government bond prices fell, while the US Dollar Index, which measures the Dollar's strength against a basket of other currencies, rose to its highest level since August.

The Dow Jones meantime ended higher Wednesday for the ninth day in a row, setting another new record high.

"The US stock market [is] now increasingly viewed as gold's main 'competition' for investment Dollars," says Ed Meir, metals analyst at brokerage INTL FCStone.

"We think gold lacks both technical momentum and investment interest to recover significantly from current levels," adds a note from Credit Suisse.

"Gold has lost its luster," agrees Danske Bank senior commodities analyst Christin Tuxen, speaking at Bloomberg's FX Debates event in London Wednesday.

"Some of the reasons investors had last year to buy into gold are now gone. The focus will be on interest rates not surging, but gradually moving higher."

China's central bank has moved from last year's pro-growth loose monetary policy stance to a "neutral" one, People's Bank of China governor Zhou Xiaochuan has said.

"Obviously there's a lot of [gold] investment demand in China... a large part of why people in China bought gold is because prices went up " says Credit Suisse analyst Ric Deverell, adding that a price fall could be detrimental for Chinese gold demand.

In the US, the Commodity Futures Trading Commission is considering whether the twice-a-day London Gold Fix, which sets the international benchmark gold price, could have been manipulated in the same way as the London interbank offered rate (Libor), the Wall Street Journal reported Wednesday.

"[The fixings are] not arbitrary," said a spokesman for the London Bullion market Association.

"It's very much done on a demand-supply basis until a price is arrived at. It's fully transparent, it's nothing like Libor."

Over in Europe, "substantial progress is being made toward structurally balanced [government] budgets," according to a draft European Union summit statement obtained by news agency Bloomberg ahead of the two-day meeting which starts today.

The statement, reports Bloomberg, calls for "growth-friendly consolidation" of government finances.

Elsewhere in Europe, Ireland borrowed €5 billion selling new benchmark 10-Year bonds yesterday, the first such sale since the country was bailed out in 2010.

The volume of gold production in South Africa fell 8.1% year-on-year in January, despite total mineral production rising 7.3% over the same period, according to Statistics South Africa figures published Thursday.

By Ben Traynor
BullionVault.com

Gold price chart, no delay   |   Buy gold online at live prices

Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK's longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics.(c) BullionVault 2013

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

Ben Traynor Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in