Online:
Visits:
Stories:
Profile image
By BullionVault.com (Reporter)
Contributor profile | More stories
Story Views

Now:
Last Hour:
Last 24 Hours:
Total:

Gold Price Sinks to 3-Week Low on Strong US Jobs Report, Asia's 'Bargain-Hunting' Down as London Vault Exports Drop, New York's GLD Inflows Hit Peak Crisis Levels

Friday, February 6, 2015 10:49
% of readers think this story is Fact. Add your two cents.

(Before It's News)

Adrian Ash is head of research at BullionVault, the world-leading gold trading & ownership service online…

GOLD PRICES sank at the start of New York trade on Friday, dropping 2.5% to hit 3-week lows beneath $1235 per ounce after new US jobs data came in much better than analysts forecast.
 
The Non-Farm Payrolls report for January estimated last month's net US jobs growth at 257,000 against Wall Street's consensus for 234,000, with December's figure revised 30% higher to 329,000 – the second-best month since June 2010.
 
The US unemployment rate ticked higher to 5.7% however, as 703,000 people were estimated to have joined the labor force.
 
“The better than expected figures quickly saw gold retreat…having a battle,” said a note from London dealers Standard Bank's commodity unit, now owned by China's giant ICBC Bank.
 
Now halving 2015's previous 10% gain of late January, gold priced in Dollars fell almost $15 per ounce within two minutes.
 
Gold priced in Euros also tumbled, breaking below Tuesday's 3-week low at €1091, even as the single currency fell hard against the Dollar.
 
Friday's new UK trade data said gold bullion exports, net of imports, totaled 468 tonnes in 2014, two-thirds below 2013's record outflow from London's specialist bullion vaults – the central storage point for wholesale Good Delivery bars dealt worldwide.
 
Gold demand in China – the world's No.2 consumer nation behind Indian – fell 25% from 2013's record to 886 tonnes last year, the China Gold Association said today.
 
China's gold mining output – the world leader since 2007 – rose 5% to 452 tonnes, the government-approved industry association added.
 
“The precipitous drop in prices in 2013,” says the China Gold Association, “led to an increase in demand of extraordinary proportions.
 
“[But] the relatively stable price in 2014 suppressed investment demand.”
 
“Last year,” says Kim An-mo of Korea Gold Exchange 3M, which reports turning over $700m in its last financial year, “investors bought gold in bargain hunting as the metal's price was declining.
 
“But now they buy gold to avoid possible financial losses related to territorial disputes, possible defaults in debt-ridden countries, falling oil prices and record-low interest rates.”
 
Thursday saw the New York-listed SPDR Gold Trust (NYSEArca:GLD) add more metal to back the value of its shares for the 10th day in three weeks – a pattern only seen or bettered after the Lehmans crash in October 2008, the stock-market lows and start of US Fed QE in February 2009, the first Greek crisis of May 2010, and the approach of QE3 in the US in late 2012.
 
Extending its heaviest inflows since August 2011, the metal held to back GLD shares has now recovered almost 10% from the fresh 6.5-year lows hit at New Year 2015.
 
The GLD's backing remains 40% below that ETF's end-2012 peak by weight, and 60% down by value from its Dollar peak.
 
“The fact that [Western] ETF investors and funds have been buying is very noteworthy,” says a new monthly report from London market makers Scotia Mocatta's New York office.
 
“[So too] is the fact that gold prices have been able to rise while the Dollar is strong and oil is weak.”

Formerly City correspondent for The Daily Reckoning in London and head of editorial at the UK’s leading financial advisory for private investors, Adrian Ash is the editor of Gold News and head of research at BullionVault – winner of the Queen’s Award for Enterprise Innovation, 2009 and now backed by the mining-sector’s World Gold Council research body – where you can buy gold today vaulted in Zurich on $3 spreads and 0.8% dealing fees.

(c) BullionVault 2010

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.



Source: https://www.bullionvault.com/gold-news/gold-price-020620151

Report abuse

Comments

Your Comments
Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

Top Stories
Recent Stories

Register

Newsletter

Email this story
Email this story

If you really want to ban this commenter, please write down the reason:

If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.