Sprott Precious Metals Watch
Sprott Is Bullish on Silver—and Gold—Equities
Sprott Silver Equities Class Co-Manager Maria Smirnova understands the power of leverage. She has seen the big impact even a slight increase in the silver price can have on silver producers. Every cent is multiplied and goes right to the investor's bottom line, giving the equities more upside than possible in a coin. That is why Eric Sprott increased holdings of silver equities in certain Sprott funds. Smirnova discusses five of these companies in this interview with The Gold Report.
A Divided Fed: FOMC Minutes Reveal Hawks Calling For QE Taper In June
It's a mad house. The FOMC appears utterly divided over key issues that seem to pull in different directions, giving arguments to both hawks and doves. "One participant preferred to begin decreasing the rate of purchases immediately, while another participant preferred to add more monetary accommodation at the current meeting," read the release, in a perfect example of what the debate must have been like. Another bearish comment had to do with the current market rally, which continues to break records and has made investors like David Tepper nervous. Noting that certain U.S. financial markets "were becoming too buoyant," a few Fed officials indicated they acknowledged the risk of creating an asset bubble. Fed Chairman Bernanke spoke of this in Congress on Wednesday as well, calling "financial instability concerns" the most significant possible cost of the Fed's ultra-accommodative monetary policy. While Bernanke acknowledged they risked "overheating the economy," he said it was worth it, as lower economic growth was even more dangerous.
Gold bar premiums in Asia hit record highs on China demand
Gold bar premiums hit new records highs in Asia on demand-driven shortages "Unless we see more supply coming into the market ... premiums will stay relatively high" Premiums for gold bars hit a record high in Asia on Wednesday as lower spot prices lured more buyers, mainly in China, the world's second biggest consumer of the precious metal, amid tight physical supplies.Premiums for gold bars in Hong Kong touched a new all-time high of $6 an ounce over spot London prices, up from $5 last week. Singapore premiums rose to $5. Banks in China were quoting up to $7 in premiums, two traders in Singapore said."China premiums remain high because of a shortage in supply of the physical metal," said a Hong Kong-based trader. "Unless we see more supply coming into the market, or spot prices trading much above the current level, premiums will stay relatively high."
China Flash PMI back into recession
China's May Flash PMI is out and the bad news keeps rolling with it sliding back into recessionary territory at 49.6 versus expected of 50.4. As you can see the internals are pretty lousy: Not disastrous but not great either.
Gene Arensberg's Got Gold Report
Big silver shorts cover madly Gene Arensberg's latest edition of the Got Gold Report has been posted in video format and it finds the big commercial traders unloading their short positions in silver to the lowest point in 13 years.
Japan’s mini crash: Blame China, not just Ben
The Nikkei 225 was clearly over-cooked. But just how over-cooked, we found out on Thursday when it fell 7.3 per cent. Paul notes that falls in the Nikkei >7 per cent are few and far between. There was the Tsunami, of course. And before that you have to go back to the big 1998 correction, and before that the full-on 1987 crash. But it also needs to be seen in context: Japan had seemingly been on an unstoppable roll.And, as the FT noted, it was apparently the small guys leading the charge. Unlike the rout of two years ago, which was led by institutional investors fearing a nuclear meltdown, brokers said that Thursday's dash for the exits was led by retail - or smaller - investors. Amari, Japan's economy minister, tried to calm everybody down: "Stock prices and the exchange rate are correlated, so it's natural that such a big fall in stocks brings about a swing to a stronger yen," Amari said. "We will continue to calmly proceed with pragmatic policies."
Source: Financial Times
Blockbuster in Gold
One of the key considerations in gold has been the redemption of more than 10 million ounces (over $15 billion) since year end from the world's largest gold Exchange Traded Fund, GLD. That is a major amount of gold and represents around 25% of the entire holdings in GLD (at year end). The gold ETF holds the largest privately held stockpiles of the metal. Consequently it has a pronounced influence on gold prices.It is widely reported that the 10 million ounces of gold that came out of the GLD have been bought by India or China, even though substantiating data is lacking. Let's only consider the facts that we know. The 10 million gold ounces that came out of the GLD equals roughly 100 million shares of GLD (one-tenth ounce per share). The 10 million ounces that are no longer in the GLD still exist and, therefore, must be owned by someone. We know that the reason the shares were liquidated in GLD was due to the rotten price performance that weighs on metals investors' minds. This tends to eliminate China as the big buyer; as such buying would cause gold prices to rise, not fall. The shares were sold and metal redeemed because the price went down, largely a self-reinforcing spiral. We know how much was sold and who the sellers were. What we don't know is the identity of the buyers. There is a good reason for that. The buyers have tried mightily to hide their identity.
Is the platinum sector imploding?
CAPE TOWN - Investors in platinum stocks have dumped their shares in a panic over the last six weeks, fearing that the platinum sector is in terminal decline. Since April the sector has fallen by 20%, bringing the cumulative decline for the year to 30%.
Treasury to take ‘extraordinary measures’ as U.S. hits debt limit again
On Sunday, the United States federal government yet again hit the debt ceiling. The Treasury Department has already confirmed that it will take "extraordinary measures" to make sure the government continues to pay its bills.In a letter to Congressional leaders Monday, Treasury Secretary Jack Lew told lawmakers that he will begin to use the civil service retirement and disability fund and a similar retirement fund for postal workers - otherwise known as the Thrift Savings Plan (TSP) - in order to generate more borrowing funds until Washington votes to raise the debt limit. The Treasury will also cease the sales of State and Local Government Series non-marketable securities until further notice.
Gold ETF Sellers Facing Tax Surprises at 28% Capital-Gains Rate
Investors who dumped shares in gold exchange-traded funds amid the biggest selloff in the metal in four years may be in for a shock: capital-gains taxes are higher than for stocks and bonds. "The ideal place to hold something like that is in an individual retirement account or other non-taxable account," Padula said. "That can save a lot of headaches." For taxable accounts, he prefers diversified commodities funds that carry the same capital gains rates as stocks and bonds. Commodities such as oil and agricultural products aren't deemed collectibles. Investors reach the top capital-gains tax rate if they make $400,000 or more annually, or $450,000 for married couples. Individuals earning more than $200,000, or $250,000 for couples, must also pay a 3.8 percent investment income tax as a result of the 2010 health-care law. For the highest earners, that may mean capital gains on gold ETFs are taxed at 31.8 percent.
Fed’s Bullard recommends euro zone consider quantitative easing
A top U.S. Federal Reserve official urged the European Central Bank on Tuesday to consider employing a U.S.-style quantitative easing programme to counter slowing inflation and recession in the euro zone. Instead, he recommended the ECB pursue an asset purchase programme. He expected this could be as effective as that employed by the Fed, which is currently purchasing $85 billon worth of bonds every month."For the euro area, I think you might want to consider the GDP-weighted quantitative easing programme", Bullard said, summing up his presentation.
Palladium Ready to Roar Again
With strong car markets in the U.S. and China, demand for the metal is up as supplies come under pressure.Palladium's bull market is about to get supercharged, as demand for the metal is set to exceed supply for a second year in a row in 2013.Almost 90% of the palladium produced last year went into catalytic converters for gasoline-burning vehicles; the metal scrubs pollution from exhaust gases. Demand from this segment rose 7.5% to a record level in 2012 amid strong car sales and stricter pollution controls, according to Johnson Matthey (ticker: JMAT.U.K.), the world's largest palladium processor. Unlike platinum and rhodium, palladium faces little threat from substitutes because it is the cheapest catalyst used by auto makers.The good news is set to continue in 2013, as car sales rev up in the U.S. and China, two countries that dominate the gasoline-engine car market. After a slow start hampered by February's Lunar New Year celebrations, Chinese car sales have kicked into high gear, posting double-digit gains in March and April. Meanwhile, U.S. auto sales continue to exceed expectations, with April's coming in at 11% above the year-earlier total.
South African mines cannot afford pay rises - Implats
South Africa's mining industry can ill afford to offer wage rises during talks that are about to start with a new and unpredictable union, so it may well face fresh strikes, Impala Platinum said on Friday. The AMCU leader, Joseph Mathunjwa, on Friday threatened to bring Africa's biggest economy to a standstill and the rand extended its slide after tumbling to a four-year low against the dollar on Thursday on fears of a strike at Anglo American Platinum (Amplats).More than 50 people have been killed in more than 12 months of unrest stemming from a turf war between the two unions."We are now going into uncharted territory," Engelbrecht said. "We are going to negotiate with a new union that we have never dealt with before on wages, so trying to predict the outcome would be foolhardy."
Silver Has Now Had An Insane Day, And Is Actually Higher After Plunging 9%
Silver got slammed last night when futures markets re-opened to begin the week.At its lowest level, the precious metal had fallen nearly 9% to $20.25 an ounce.Remarkably, it's already staged a big comeback, and it just turned positive on the day.In the past few minutes, it's screamed higher, and is now trading around $23.00, up 2.7%.Miller Tabak's Jonathan Krinsky offers some commentary on why the details of the sell-off may actually be positive for those bullish on gold and silver: The other interesting action, which started last night, has been the precious metals. After being down over 8% at one point, Silver has nearly recovered the entire decline. Gold has actually gone into positive territory. If you are a Bull on precious metals, there are some positives in that type of action. First, Gold did NOT make a new low with Silver overnight. The low of 1338 was slightly higher than the April 16th low of 1322. That could be considered a non-confirmation and “potential” bullish divergence. Also note that even as Silver made a new low by a wide margin, RSI does not appear to be doing so, another non-confirmation. Of course none of this means the medium or long-term trends have changed, they are still quite bearish. It does, however, open up the potential for a short-term bounce.
Why Silver Prices Fell Today then Recovered in Wild Trading
If you're wondering why silver prices fell sharply Monday, it looks like the answers lie in Asia.Silver prices staged a sharp recovery Monday after volatile trading that took the white metal tumbling 9% in 10 minutes to $20.25 an ounce, a level not seen since 2010.The steep selloff followed a spike in the Japanese yen against the dollar. Precious metals traders surmise investors were forced to sell silver to cover losses in the currency market. The result was a rash of automated sell orders.Indeed, the effect has so extreme and rapid, the Chicago Mercantile Exchange halted silver futures trading four times to restrain volatility and rein in excessive price movements, a move known as Stop Logic. Because volumes for silver are lower than for gold, they are more prone to sharp swings, up and down.Data shows more than 3,000 contracts in Comex silver futures sold in just 20 minutes during early Asian trading. Standard Bank in Tokyo confirmed an unidentified investor sold a sizable position of silver Monday morning.
Draft law to bail-in large depositors approved
Europe has moved a step closer to bailing in large depositors in future bank rescues, as happened in Cyprus this year.Last night, the European Parliament's economics committee approved draft legislation under which customers with more than €100,000 would be liable to fund a rescue package. Smaller savers, though, would still be protected.This new bank recovery and resolution mechanism is meant to end the era of taxpayer-funded bank rescues. Bank of England Deputy Governor Paul Tucker called it a milestone towards a world where governments were no longer willing to rescue banks that are “too big to fail”.Under the EU proposal, a bank would dip into large deposits of over €100,000 once it had exhausted other avenues such as shareholders and bondholders, Reuters explains.
Platinum industry faces a new time bomb
ANGLO American Platinum's (Amplats's) plan to retrench 6,000 workers, and the determination by the mining unions to fight it, would seem to cap what has been an appalling year for South Africa's platinum producers. But there is another time bomb ticking in the industry. Some of the mining houses', including Amplats's, best assets are on properties whose original owners are still waiting for restitution for land they were driven off during the colonial and apartheid eras.
Gold bar premiums hit record in Asia on supply constraints
Premiums for gold bars rallied to all-time highs in Hong Kong and Singapore on Thursday after bullion's steepest drop since its April sell-off fuelled another round of buying, constricting supply. Gold bars in Hong Kong fetched premiums of up to $5 an ounce over spot London prices, driven by tight supply and strong demand from China, the world's second-largest consumer after India. Premiums stood at $3 an ounce last week.
Gold Demand Trends First Quarter 2013
Total jewellery demand was up 12% year-on-year in Q1 2013, driven in the main by Asian markets. Jewellery demand in China was up 19% on the same period last year and stood at a record 185 tonnes(t). Demand in both India and the Middle East was up 15% respectively and in the US, demand showed a significant increase, 6%, for the first time since 2005.
So Much for Position Limits on COMEX Gold
Flash back to Friday, April 12, when the paper gold futures market was slammed with an enormous sell order in the early going of New York trading, following a “tenderizing” of the market right at the New York open. We have read and heard various descriptions of the initial sell order being as little as 124 tonnes and as much as 400 tonnes of gold equivalent – sold by a single source or by a group all at once – with the express intent to break the gold market.
Eurozone recession extends into 6th quarter
The recession across the economy of the 17 European Union countries that use the euro extended into its sixth quarter — longer than the calamitous slump that hit the euro area during the financial crisis of 2008-9. Eurostat, the EU's statistics office, said Wednesday that nine of the 17 eurozone countries are in recession, with France a notable addition to the list.
Is The South African Mint Short Of Gold?
Examining US trade data, we were surprised to see that South Africa’s $402 million trade surplus with the United States in January had turned into a $689 million deficit by March. Why? It turns out the $1.1 billion swing is entirely due to unusual shipments of gold from the US to South Africa in February and March.
JPM Eligible Gold Plunges To New Record Low, And Why It Could Have Been Much Worse
Back on April 25, in the aftermath of the latest epic precious metals takedown, we reported that something odd had happened: overnight, total Eligible gold held in the vaults of JPM dropped by 65%, or 260.8k ounces in one day, to a record low of only 141.6K ounces. Contrast that with the 2 million Eligible ounces the JPM vault at the basement of 1 CMP held when it reopened.
U.S. Banks Buy Gold Futures in Dramatic Position Change
As gold fell down to test the $1,300s U.S. banks very strongly reduced their collective net short positioning and came within a whisker of becoming actually net long for the first time since the 2008 panic. Clearly the U.S. banks, presumably including U.S. bullion banks, are not, that's not, positioning as though they believe there is a great deal more downside left in gold futures.
Record High Gold Bullion Sales at the Perth Mint
BullionThe Perth Mint of Australia achieved record breaking sales for gold bullion products in April, as lower precious metals prices spurred a huge leap in demand. Silver bullion sales also jumped to the highest level in six months.
Thinking in the same old way will not rescue the platinum industry
We would like to take a step back and assess how profitable platinum miners are, and calculate the expectations embedded in their market prices. Once we understand those expectations, we can focus on the best way forward.
Palladium Supply Deficit Likely To Continue Until 2017
South Africa is currently responsible for approximately 38 percent of world mine production. Norilsk Nickel's mines in Russia account for approximately 41 percent of world mine production and North America contributes approximately 14 percent to the world's supply. Palladium is currently trading at the highest levels since 2001 and is projected to remain strong through 2017 as the supply deficit is expected to persist in the future. The outlook for palladium over the next ten years predicts a return to historically high prices, strong fabrication and investment demand, and constrained supply.
Lonmin Sees Annual Shortfall of 200,000 Oz PGMs after Anglo Cuts
Lonmin PLC (LMI.LN), the world's third-largest primary platinum producer, said Monday it expects a "deepening market deficit" to emerge in platinum group metals after production cuts announced last week by Anglo American Platinum PLC (AMS.JO).
PGM Prices to Rise as Deficits Grow, Norilsk
Top world palladium producer Norilsk Nickel expects the global palladium deficit to rise by 25% in 2013 as supplies fall, according to the deputy head of sales arm Normetimpex. "We expect a significant deficit in the palladium market this year -- at about 1Moz," Anton Berlin said. Last year, the deficit was about 800,000oz.
Gold ETF Sees Its Biggest And First Inflow In 2 Months
The largest gold exchange-traded fund in the world, the SPDR Gold Trust (GLD), garnered investor inflows of $127 million on Thursday, the largest since March 19. It was also the first time investors added to their positions since that date, ending a remarkable string of redemptions spanning almost two months.
Miners won't stand for Amplats job cuts
Miners have vowed to halt operations at Anglo Platinum ‒ the world’s biggest platinum producer ‒ even if retrenchments are scaled back to 5,000 from the initial 14,000 previously announced, according to a worker affiliated with mining union AMCU. Amplats planned to axe 14,000 jobs and mothball two mines to return to profit, but industry sources said the final plan would be pared back, with as few as 5,000 jobs cut and an announcement expected by today, reports Fin24, citing Reuters. Workers have signalled that they will launch protest strikes even if the job cuts fall far short of the initial target. Amplats has been in talks with the government for months to hammer out a restructuring plan.
Gundlach: Have An Inflation Hedge, But Make It Silver, Not Gold
DoubleLine bond guru Jeff Gundlach‘s been talking bonds on CNBC this afternoon, and as he’s wont to to he’s wading into some other markets too like MLPs and, of course, Apple (AAPL) stock. Notably he says (somewhat begrudgingly) that in this “wacky” era of quantitative easing you need to have some sort of inflation hedge in your portfolio, but that it should be silver, not gold.
Silver Struggles to Stay Above $24 Despite Thriving Physical Demand
Demand for physical gold has surged since the yellow metal’s abrupt mid-April price drop, and physical silver demand has risen along with it. In fact, MarketWatch notes in a recent article that the US Mint has sold over 19 million 1-ounce American Eagle silver bullion coins so far this year, nearly 5 million more than were sold in the same period last year. The articles quotes Anthem Blanchard of Anthem Vault as saying that this increased buying has made physical silver harder to obtain than physical gold because “there is less above ground supply of physical silver than there is of gold.”
JPM Eligible Vault Gold Drops To Fresh Record
Two weeks ago we reported about one of the biggest daily withdrawals of eligible gold from the JPM gold vault, it not on an absolute basis, then certainly on a relative, when in one day over 260k ounces of gold were withdrawn, leaving a record low 141.6k ounces, or just over 4 tons of gold in the vault. Subsequently, we tracked the daily additions and withdrawals of gold from the vault to see if any other major withdrawal request would come, instead discovering instance after instance of JPM reclassifying Registered gold into Eligible, which is how the vault saw its eligible inventory rish back to 195K ounces as of yesterday, without any actual net additions or more importantly withdrawals. It seems the pause of withdrawals has ended, and as of yesterday, another delivery led to a withdrawal of 53,658 ounces, or 28.5% of the total, leaving a fresh record low inventory of only 137,377 eligible ounces in the vault.
South Korea Joins India-to-Europe Rate Cuts for Growth: Economy
Governor Kim Choong Soo and his board lowered the benchmark seven-day repurchase rate to 2.5 percent from 2.75 percent, the central bank said in a statement in Seoul today. Six of 20 economists surveyed by Bloomberg News predicted the move while the remainder forecast no change. Kim supported a cut after opposing one last month.
Mine Sales in Bear Market Brings Private Equity on Prowl
Mining companies led by BHP Billiton Ltd. (BHP) are holding the biggest ever sale of assets this year just as commodity prices head into a bear market. What's bad timing for the miners might be the opposite for private equity.About $48 billion of mines and assets are on the block, almost double last year's $23 billion of completed and pending deals, according to data compiled by Bloomberg."I haven't seen anything like it in more than 20 years," said Tim Schroeders, who helps manage about $1 billion in equities, including BHP and Rio Tinto (RIO) Group, at Pengana Capital Ltd. in Melbourne. "Mining companies have done pretty well buying assets at the bottom of the cycle and turning some over near the top, but this is completely the other way around."BHP, the world's biggest mining company, and London-based Rio Tinto are leading the global asset disposal and may sell businesses or stakes in mines for as much as $35 billion, according to Deutsche Bank AG. Private-equity firms are finding that tempting, raising almost $9 billion in 16 months for mine investment, more than the previous four years combined, according to data compiled by Bloomberg.
Tensions high as Amplats to unveil plan to cut jobs
Anglo American's platinum arm, under pressure from South Africa's government, could announce a restructuring plan as early as Thursday that will sharply scale back job losses as it tries to balance out cost cuts and the threat of labour unrest.Anglo American Platinum had planned to slash 14 000 jobs and mothball two mines to pull back to profit but industry sources have told Reuters that the final plan would be pared back, with as few as 5 000 jobs cut.
NY Fed Warns of Continued Risk to Financial System
The Federal Reserve Bank of New York said in a paper released Tuesday that a key short-term funding market remains vulnerable to destabilizing runs that can threaten the broader health of the financial system. "Limited tools are available to mitigate the risk of pre-default fire sales," the paper's authors warned. What's more, "no established tools currently exist to mitigate the risk of post-default sales."
China produces 90 tons, consumes 320 tons in Q1-2013
China's total gold usage reached 320.54 metric tonnes in the first quarter, China Gold Association said. According to CGA, purchases of gold bars surged 49% to 120.39 tonnes, while jewelry gained 16% to 178.59 tonnes. Gold consumption in China soared 26% in the first three months of 2013 from a year ago amid strong bullion sales and rising jewelry demand.
U.S. Mint Sales For April: Most Gold Sold In Mint History
the U.S. Mint's gold sales numbers show that April was the strongest month in the Mint's history. The U.S. Mint sold a staggering $311 million worth of gold in the month! Though an increase in sales was expected since the gold price dropped, these numbers blew away even the most optimistic estimates. Silver sales also were very strong and again breached the $100 million level and, as we mentioned in our previous article, are on pace to surpass total U.S. silver mine production by a significant amount.
Slovenian bank crisis could require $10.5-billion bailout
Investors and economists fear Slovenia will become the next victim of a bank blow-up, the latest in a string of banking woes in small European countries that have had a nasty habit of spinning out of control.Slovenia is not Cyprus – the assets of its banking sector are only 140 per cent of GDP, compared to 700 per cent for the Cypriot banks, which were rescued in March by a €10-billion bailout and a haircut on depositors’ bank accounts that may reach 60 per cent. But the Slovenian banks could still pose a grave risk to the economy and deliver another blow the tentative euro zone recovery if the rescue goes wrong.
Royal Canadian Mint Achieves Record Numismatic Revenue
The Royal Canadian Mint recorded revenue of $2.6 billion and pre-tax profits of $40.7 million for 2012. Both figures represented declines from the prior year, when revenue was $3.2 billion and pre-tax profits were $43.8 million. The highlight for 2012 was the numismatic segment which saw revenue surge by 56% to a record $145.1 million.
China’s Gold Consumption Jumps 26% in First Quarter Before Rout
Gold consumption in China, the world's largest user after India, jumped 26 percent in the first three months of 2013 from a year ago amid strong bullion sales and rising jewelry demand, an association said.Total consumption reached 320.54 metric tons in the first quarter, the China Gold Association said today in an e-mailed report. Purchases of gold bars surged 49 percent to 120.39 tons, while jewelry gained 16 percent to 178.59 tons, it said. Gold output in China, the world's largest producer, gained 11 percent in the same period to 89.91 tons, according to the association.
American Eagle Silver Coins Sales Soar in April
Mineweb reported that April sales for American Eagle coins leaped by 169 percent. Meanwhile American Eagle silver bullion coins sales for the month of April shot up nearly 169% over than last year from 1,520,000 silver ounces in April 2012 to 4,087,00 ounces. "Year-to-date sales of 18,310,000 have never been achieved so soon in a year," Coin News observed Tuesday. "Last year sales did not top 18.3 million until July 16."
Ex-Barrick CEO seeks mining assets with new firm
According to two people familiar with the matter, former Barrick CEO Aaron Regent has started a company to invest in mining assets, mainly in the Americas. Regent, 47, joins other prominent figures in the mining industry who are setting up, or plan to establish, companies to buy assets. They're doing so at the same time as some of the world's largest miners are selling off unwanted operations. Former Xstrata Plc Chief Executive Officer Mick Davis and Chief Financial Officer Trevor Reid are weighing plans to set up a privately backed mining fund, people familiar with the matter said last month.
This Is What Could Drive Platinum Higher, Very Soon
The likelihood of strikes this May and June by workers in South Africa's strategic mining sector may curb output from the world's largest supplier of platinum, presenting an upside risk for the precious metal, analysts said. The catalyst for any upswing may come as early as this week when Anglo American Platinum (Amplats) - the world's top platinum producer and a unit of Anglo American - reveals the outcome of talks with the government and unions about restructuring plans that may involve cutting up to 14,000 jobs and mothballing two mines in South Africa.
RBI move may deal a blow to gold jewellery business
On Friday, in the annual monetary policy for fiscal year 2014, the Reserve Bank of India (RBI) said banks can import gold only to meet the genuine needs of exporters of gold jewellery, implying that imported gold cannot be used to make ornaments for consumption in the domestic market. The central bank also restricted the facility of loans against gold coins per customer to gold coins weighing up to 50 gm. India is the largest importer of gold and more than half of the imported gold is used for wedding ornaments, according to WGC. Only 20% of the ornaments are exported, gold industry officials and bankers said. Unlike other countries, India has a liking for the yellow metal more due to its linkages with tradition rather than for mere investment.
Implats losing battle against costs, softer metal prices
A growing number of Impala Platinum’s (Implats’) shafts are making losses, or barely scraping by, because of the weak platinum prices, and the company warned on Thursday it was assessing the viability of these shafts. Implats, the world’s second-biggest platinum producer, said costs at its mines had ballooned by 23% to R15,957 per platinum ounce in the nine months to end-March 2013. Costs were pushed higher by inflation and the effect of last year’s debilitating strike that stripped 140,000oz out of the company’s output. "The steep drop in PGM (platinum group metal) prices has had a further significant impact on group profitability with a growing number of shafts either marginal or loss-making," the producer said on Thursday. "These units are being monitored on a continuous basis to determine their ongoing viability,"
Palladium Shortage Surged to 11 Year-High in 2012, GFMS Says
Palladium’s deficit rose to the biggest in 11 years in 2012 as strike action in South African mines curbed supply and demand expanded, Thomson Reuters GFMS said. Platinum slipped into a deficit for the first time since 2004.Palladium supply fell 4 percent to 8.19 million ounces as usage expanded 5 percent to 9.32 million ounces, the highest on record, the London-based researcher said today in a report. Excluding sales from Russian state stocks and investor selling, demand outstripped supply by 1.12 million ounces, the biggest gap since the 1.3 million-ounce shortfall in 2001, GFMS said.
What is Platinum Week?
During the third week in May each year, representatives of the platinum industry gather in London, England for what has become known as Platinum Week. London is a historically significant trading centre for PGM where many of the properties and technical applications of PGM were first developed. Platinum Week centres on an industry dinner sponsored by the London Platinum and Palladium Market (LPPM) which marks the anniversary of the inauguration of the London Platinum Quotation (the forerunner of the present London Fixings) in 1973.
WGC: Gold-Backed Bonds an Alternative to Italian Austerity
Gold-backed sovereign debt presents a good opportunity for Italy and other states facing significant financial challenges to regain the confidence of bond markets and lower funding costs, the World Gold Council said Thursday. Gold-backed bonds are underpinned by gold collateral. This could be bonds partially backed by gold, or a tranche-based structure developed to appeal to different types of investors. According to the WGC, while the outright sale of national gold reserves wouldn't meet the required level of funding for Italy, using gold-backed bonds could help the country raise around 80% of its two-year refinancing needs. "We are already seeing this use of gold develop in the private sector--two large clearing houses, LCH.Clearnet and ICE Clear Europe, now accept gold as collateral for the clearing of derivatives contracts. As a real asset, the use of national gold reserves as collateral is not inflationary," the WGC said in Thursday's report. "To a great extent, this is gold's purpose [and] gold's lack of credit risk and counter cyclical tendencies makes it an ideal asset to be used as collateral."
SA gold producers on wafer thin margins
South Africa’s high cost gold producers have very little margin for output mishaps at price levels around $1,400 per ounce for the metal; a dilemma exacerbated by the limited number of options at their disposal to rightsize operations in a tense labour and political climate. Company results for the fourth quarter of 2012 show a number of mines and shafts that would not break even at a gold price of $1,400/oz on a notional cost basis (NCE, which includes cash costs, capital expenditure and near mine exploration).
Gold Helps China May Day Sales Rise 20%
China’s recent manufacturing data might suggest a slow down, but one thing is for sure, the consumer story in the country is still firmly in place. This past May Day weekend saw retail sales rise by as much as 20%, most of it thanks to people shopping for gold jewelry. According to the Shanghai Commission of Commerce, retailers in the city reported total sales of 3.37 billion yuan ($539 million) between Monday and yesterday, up 18.8% from the same period of last year. Sales of gold jewelry and even gold bars rose as gold prices fell and started to look more affordable. This is also the start of wedding season in China. Sales of gold and jewelry jumped 108% from a year earlier, leading all other categories, the Shanghai Commission of Commerce said on Thursday.
Junior mining stocks see record insider buying
Those looking for even more evidence that corporate executives are smelling bargains in the junior mining sector should consider this: Insider buying on the TMX Venture exchange is near a record high. INK Research’s Venture indicator is at 715 per cent today, just 20 percentage points below its record peak of 735 per cent set on Oct. 27, 2008. That means there are more than seven stocks listed on the exchange with insider buying for every one seeing selling. It also marks a steep increase since early March, when the indicator was near 400 per cent. Such a high level of buying interest among officers and directors within their own businesses in the resource sector has correctly foreshadowed a recovery in share prices in the past: That high point of nearly five years ago came about six weeks before the Venture market bottomed on Dec. 5, 2008.
CME Chairman On Gold: “People Don’t Want Gold Certificates, They Want the Real Product”
"What’s interesting about gold, when we had that big break two weeks ago we saw all the gold stocks trade down significantly, we saw all the gold products trade down significantly, but one thing that did not trade down, was gold coins, tangible real gold. That’s going to show you, people don’t want certificates, they don’t want anything else. They want the real product ."
U.S. Mint Sales of Gold Coins Jump to Highest in Three Years
Sales of gold coins by the U.S. Mint rose to the highest since December 2009 after the price of the metal in April fell the most in 16 months. Last month, sales totaled 209,500 ounces, up from 62,000 ounces in March, data on the mint’s website show. The amount for December 2009 was 231,500 ounces. Silver-coin sales rose to 4.2 million ounces from 3.36 million in March. Demand surged at mints from Australia to the U.K... Perth Mint, which refines almost all of the nation’s bullion, said that demand jumped to the highest in five years after prices plunged, with the factory kept open through the weekend to meet orders. In Australia, buyers were waiting in lines half a kilometer (0.3 mile) long to get minted coins, and jewelry shops in India and China ran out of gold in a single day, Jason Toussaint, the managing director of investments at the London-based World Gold Council, said in an interview. Trading for the benchmark contract on the Shanghai Gold Exchange surged to a record last week, while premiums to secure supplies in India jumped to five times the level before the slump.
Perth Mint testifies to exploding demand for gold after price fall
Australia's Perth Mint, which refines nearly all of the nation's bullion, said that demand has jumped to the highest level in five years after prices plunged, with the factory kept open through the weekend to meet orders. There's been strong interest, including from the U.S., with buyers speculating that the metal will rebound from the decline, Ron Currie, sales and marketing director, said in a phone interview from Perth. Bullion fell 14 percent in the two days to April 15, the most since 1983, spurring buyers to increase physical holdings. Billionaire John Paulson, the biggest investor in the largest exchange-traded product backed by bullion, reiterated his bullish view on prices. Coin sales by the U.S. Mint are set for the highest month since December 2009, while premiums to secure supplies in India rose to five times the level before the slump. "We haven't seen levels like this since the 2008 global financial crisis," Currie said yesterday. "Compared to March sales, April sales have doubled or tripled," he said, without providing figures. Gold for immediate delivery traded at $1,473.05 an ounce at 8:01 a.m. in Singapore after losing 0.2 percent. While prices have gained 11 percent from a two-year low on April 16, they are still 5.7 percent below the April 11 close before the rout. Increased physical purchases may help to offset declining holdings in ETPs, which are on course for a record contraction in tonnage terms this month, according to data compiled by Bloomberg. Holdings have lost 168 tons in April, the data show.
Eric Sprott - Silver To Skyrocket Hundreds Of Dollars in Price
Eric King: “Eric, where do you see silver headed? Give me a number.” Sprott: “If gold goes to a new high this year, I think silver is going to a now high, which means above $50. Where is it ultimately going to go? I think it will be in the hundreds of dollars. If gold goes to $3,000, silver is (already) going to be (trading) $150 to $250. That’s a big, big gain from here. You are not going to get those kinds of gains in other instruments. You are not going to get that owning bonds or (general) stocks. The metals are the place to be. It’s so unfortunate that we’ve had this ridiculous selldown here in the face of all things that are great for gold. But there are reasons that people, the central planners, may have wanted to have it down. If it was the central planners that knocked it down, man did they lose that game because it just ignited the interest in (physical) gold and silver. I just think we are going to be many times higher than we are today. It’s going to be a long-run, we are going to have this bull market go on for another 5 to 7 years. I just don’t know how high the price is going to be (for silver). There is total insanity going on amongst the central planners right now. You tell me how desperate central banks are going to be and I can tell you how high the price is going to go.”
Gold Bears Defy Rally as Goldman Sachs Closes Short Wager
Commodities Hedge funds accumulated their second-biggest bet against gold on record just as prices rallied the most in 15 months on surging demand for coins and jewelry and Goldman Sachs Group Inc. ended a recommendation to sell. The funds and other large speculators held 69,726 so-called short contracts on April 23, within 0.6 percent of the all-time high reached six weeks earlier, U.S. Commodity Futures Trading Commission data show. The net-long position dropped 25 percent to 46,168 futures and options. Gold futures jumped 4.2 percent to $1,453.60 an ounce on the Comex in New York last week, the most since January 2012. Analysts are the most bullish in a month, with 15 anticipating higher prices this week. Eleven are bearish and three neutral, according to a Bloomberg survey. Holdings in global ETPs slumped 13 percent to 2,283.57 tons this year, the lowest since October 2011. Hedge funds expanded short wagers 17 percent to more than quadruple the average since 2006, when the CFTC data begins.
China Goes Gold Crazy. Why Now?
Mainland Chinese purchasers have been ferocious. First, they emptied stores in their own country. Caibai, Beijing’s largest gold merchant, had a queue 30 feet out the door on the morning of the 19th. “So many people in line,” remarked a customer in Nanjing, where one person splashed out 2.9 million yuan on ten gold bars each weighing a kilogram. Retailers ran out of stock in Guangzhou. The China Gold Association reported that on the 15th and 16th retail sales of gold tripled across China. Daily sales soared to five times the usual level at one retail chain. Volume on the Shanghai Gold Exchange, considered a proxy for the metal’s demand in China, surged, setting consecutive records of 30.4 metric tons on the 19th and 43.3 tons on the 22nd. The previous record was 22.0 tons on February 18 of this year. As Chinese emptied the shelves in their own country, they also went south and swarmed shops in Hong Kong, sometimes in groups. Chow Tai Fook, the world’s largest jeweler by market capitalization, said some stores popular with Mainland Chinese ran out of gold bars and that demand had not been as strong since the late 1980s.
JPMorgan's Eligible Gold Plummets 65% In 24 Hours To All Time Low
According to the Comex, JPM's eligible gold plunged from 402.4K ounces to just 141.6K ounces, a drop of 65% in 24 hours,and the lowest amount of eligible gold held at the vault on record, since its reopening in October 2010!...
Gold futures logs biggest one-day gain of the year
Gold futures jumped by nearly $40 an ounce on Thursday to log the biggest one-day gain of the year, supported by physical demand for the precious metal, prospects for easier global monetary policies and a weaker U.S. dollar.Thursday's rally has brought gold back to roughly 50% of the massive recent sell off, said Phil Storer, director of trading at Dillion Gage Inc., a precious-metals dealer and refiner.
Fed Debate Moves From Tapering to Extending Bond Buying
Debate among Federal Reserve policy makers is shifting away from the timing of a reduction in bond buying to the need to extend record stimulus. At their meeting last month, several members of the Federal Open Market Committee advocated slowing purchases and stopping them by year-end. Since then, seven have voiced support for maintaining the current pace, including five who vote on the policy making panel: Governor Daniel Tarullo, New York Fed President William C. Dudley, James Bullard of St. Louis, Chicago's Charles Evans and Boston's Eric Rosengren.
U.K. Royal Mint Gold Coin Sales More Than Tripled in April
Britain’s Royal Mint, establishedin the 13th century, sold more than three times more gold coinsthis month than a year earlier as prices declined. Sales are more than 150 percent higher than last month,according to Shane Bissett, director of bullion andcommemorative coin at the Royal Mint. Gold is down 11 percentthis month, heading for the biggest drop since September 2011. “Since the dip in the price of gold we have seen increaseddemand for our gold bullion coins from the major coin markets,and this presently shows no sign of abating,” Bissett said bye-mail in response to questions from Bloomberg. “The Royal Mintcontinues to supply to its customers and is increasingproduction to accommodate the higher demand.”
Continued Strong Silver Investment Demand Drove Annual Average Price to Second Highest on Record
Robust global silver investor demand was the dominant driver of silver prices last year, accounting for almost a quarter of total silver demand. Averaging $31.15 per ounce, 2012’s price level was the second highest on record, behind the average reached in 2011. While last year was a volatile year for most precious metals, globally, silver investment rose to a total of 252.7 million troy ounces (Moz). That figure represents approximately $8 billion on a net basis, substantially above the annual average of $1.2 billion over the 2001-10 timeframe, according to “World Silver Survey 2013,” released here today by the Silver Institute.Investors remained significant net buyers of silver in 2012, as evidenced by the 21 percent increase in implied net silver investment (which includes physical bar investment, exchange traded funds and fund activity on Comex) to set an all-time high of 160.0 Moz. By comparison, in 2004, the level of implied net silver investment was 5.4 Moz.
Central banks buy gold ahead of crash
Russia and Turkey raised their gold reserves in March, the International Monetary Fund said on Wednesday, increasing their holdings ahead of a spectacular plunge in prices this month which sent gold to its lowest in more than two years.But ahead of this turbulence some central banks increased their reserves. The Russian Federation, the world's 8th largest holder, lifted its gold reserve for a fifth straight month in March, adding 4.7 tonnes of gold to its reserves, which stood at 981.648 tonnes by the end of last month, the IMF data showed.Turkey raised its holdings by 33 tonnes to 408.874 tonnes, and South Korea increased its holdings by 20 tonnes in February to 104 tonnes.
Gold Rout for Central Banks Buying Most Since 1964: Commodities
Central banks bought the most gold since 1964 last year just before the collapse in prices into a bear market underscored investors’ weakening faith in the world’s traditional store of value. Nations from Colombia to Greece to South Africa bought gold as prices rose for an 11th year in 2011, highlighting the reversal of a three-decade-long bout of selling that diminished the world’s biggest bullion hoard by 19 percent. The World Gold Council says they added 534.6 metric tons to reserves in 2012, the most in almost a half century, and expects purchases of 450 to 550 tons this year, valued now at as much as $25.3 billion.
Worldwide Silver Shortage As Premiums On Silver Eagles Reach 40%
Not one to give up so easily, I proceeded to call a friend and colleague that runs Cornerstone Bullion out of Denver, Colorado. I have purchased bullion from Chad in person several times and have recommended his services to my readers. He has always been able to find supply for me and while the premiums have fluctuated, they have consistently remained within a few percentage points of the lowest-priced online dealers. This was his reply: Most everything is shipping early June from the Mint. Premiums are $4.99-5.50 right now, depending on quantity. It's pretty crazy out there right now. Junk silver is $5-6 over spot!I then went online to Tulving.com to see if they had replenished stocks, but all of their popular silver bullion products remain 'Sold Out' including silver eagles. APMEX appears to have inventory, but they are asking around $31 per silver eagle or roughly $8 over spot price. That is a premium of 36% to the spot price.eBay (EBAY) prices are even higher at around $32 per ounce for silver eagles or $9 over spot price. This is a premium of roughly 40%! Silver eagles from a few years back are selling for $700 or more per roll of 20, which is $12 over the spot price and a premium of more than 50%.
And Goldman closes its gold short recommendation
Following their absolutely stellar advice to short gold on April 10, Goldman Sachs announces on Tuesday it is now time to take profit on that position:We have closed our recommendation to short COMEX Gold, as prices moved above the stop at $1,400/toz. We have exited the trade significantly below our original target of $1,450/toz, for a potential gain of 10.4%. The move since initiation was surprisingly rapid, likely exacerbated by the break of well-flagged technical support levels. Our bias is to expect further declines in gold prices on the combination of continued ETF outflows as conviction in holding gold continues to wane as well as our economists’ forecast for a reacceleration in US growth later this year.
Source: Financial Times
U.S. Mint Runs Out of Smallest American Eagle Gold Coin
The U.S. Mint ran out of its smallest American Eagle gold coin after demand surged following the biggest drop in futures in three decades.Sales of the coins weighing a 10th of an ounce were suspended after demand more than doubled in 2013 from a year earlier, the Mint said yesterday in a statement. Total sales of American Eagles in April have almost tripled from a month earlier, according to its website.
Hedge Funds Plowed Into Gold as Market Looked Vulnerable
Hedge funds and other big speculators plowed new money into gold even after the precious metal posted a record loss in dollar terms this week, according to trading data on Friday [April 19] that also showed inflows for many other commodities.The net long money held by money managers across 22 U.S.-traded commodities rose nearly $950 million, or 6 percent, to $56.5 billion in the week ended April 16, according to Reuters calculations of data released by the U.S. Commodity Futures Trading Commission.The data surprised traders and analysts who had been expecting a huge outflow of money from gold and many other commodities this week after prices tumbled across markets on April 15, triggered by global economic worries."I think most people would be stunned looking at these numbers, particularly for gold, where there are still so many long even as the market sank like a stone," said Adam Sarhan, founder of Sarhan Capital in New York.The net long position in gold futures on New York's COMEX held by money managers, including hedge funds, rose by 5,495 contracts to 61,579, the CFTC Commitment of Traders data showed.Open interest in gold, a measure of market liquidity, rose by a staggering 24 percent.
Gold sale not a priority: Cyprus finance minister
Cyprus is not giving priority to a sale of gold reserves under the international bailout agreed this month and is still exploring all options to meet its side of the deal, Georgiades said in an interview. Georgiades also said he anticipated currency controls, imposed after a chaotic bailout last month and which led to a lockdown of the banking system for 15 days would be eased in "days or weeks".
Hedge funds add to bets that gold prices will rise: CFTC data
Data from the Commodity Futures Trading Commission's Commitments of Traders report released Friday showed that managed money, which include hedge funds and commodity trading advisors, took advantage of the recent, steep drop in gold prices to cut down their "short" bets - bets that prices will go lower.Managed money traders raised their net "long" positioning, or bets prices will go higher, by 21,675 contracts to 68,662 contracts net long, according to Gene Arensberg, editor of the Got Gold Report. Managed money, which had recently built up a record short position in gold, covered 12,411 shorts to show a "still high" 54,025 contracts of short gold futures, he said."Managed money covered a goodly portion of their huge short position and they increased their net long position, but they still hold a very large gross short position," said Arensberg.
Ignore COMEX Pricing – Silver Eagles Sold Out at Dealers, $33 on Ebay
The silver price has taken a beating over the past week, dropping 18% from $28 to $23. Or at least that is what the COMEX is telling us. In reality, the price of silver is nowhere close to $23. Don't believe me? Try to find silver coins for sale anywhere in the free market at that price. Supply shortages and rising premiums for silver coins are not isolated to just one dealer. APMEX is another large online bullion dealer that has sold out of monster boxes of 2013 silver eagles. They only list individual rolls for sale at around $630, which comes out to $31.50 per ounce.
Shortage of gold bars and coins in Dubai, says World Gold Council
World Gold Council, which has been tracking the global gold market pattern, has found that there is a shortage for bars and coins in Dubai which is creating a supply shortage.
Switzerland to Hold Referendum Banning its Central Bank from Selling Gold Reserves
Switzerland is to hold a referendum on a popular measure that would ban the central bank from selling its gold reserves and force it to keep at least 20 per cent of its assets in the metal. Under the terms of "Save our Swiss Gold", which is led by members of the ultra-conservative Swiss People's party, the Swiss National Bank would have to repatriate gold reserves held abroad and keep them at home.Governments in the eurozone's beleaguered southern periphery tend to hold a large part of their total foreign reserves in gold - the Italian central bank holds 2,451 tonnes, more than 70 per cent of its total reserves, while Portugal's holding of 383 tonnes accounts for 90 per cent.However, proponents of the Swiss measure flatly reject the idea of sales, arguing that disposals of gold reserves at low prices between 2001 and 2006, as well as more recently, have cost Switzerland billions of Swiss francs.They insist that the SNB's gold reserves, which stood at SFr49.5bn at the end of February, accounting for about 10 per cent of its balance sheet, are the best store of value available to the central bank.
Has gold hit bottom? As big investors rush out, consumers rush in
Gold traders are divided on whether bullion will extend declines after the biggest plunge in three decades generated ‘extraordinary’ buying from investors and jewellers. Fifteen analysts surveyed by Bloomberg expect prices to rise next week, 14 were bearish and a further five were neutral. Gold tumbled 13% in the two sessions through April 15, the biggest drop in 33 years, on concern European governments would follow Cyprus in selling off reserves, while an unanticipated slowdown in Chinese growth sparked declines across commodities. In the past four days, bullion has rebounded about 3.7% on the Comex in New York.
Speculators in futures markets caused gold price crash, says WGC
WGC: "It has become increasingly clear over the course of the past week that the fall in the gold price was triggered by speculative traders operating in the futures markets. Their short-term view of generating a trading profit is in stark contrast to the views of long term investors in gold, as evidenced by the massive wave of physical gold buying that began over the weekend and accelerated following Monday’s further decline. The surge in gold purchases is spanning markets from India and China to the US, Japan and Europe. Buyers are viewing this as an opportunity to purchase gold at prices not seen in the past couple of years."
Rule - More Evidence Of A Massive Run On Physical Gold
“We allocated about $5 million to the market yesterday to juniors. Ben Graham also famously said, ‘You shouldn’t buy a stock if you wouldn’t be delighted to see it fall 20% of 30% further in the next week so you can buy more cheaper.’ I’ve been tested by that at least 100 times in my career, Eric, and I’m probably going to be tested by it now. But the truth is that it has done me well over time to exercise that discipline. If you understand the absolute values of things relative to the expressed market values, buying extremely undervalued stocks works out well for investors, and that’s what I am trying to do... “I've been taking this opportunity to stock up on some yellow metal. Went to Hang Seng bullion counter yesterday. The line was out the door. It took an hour wait to see a teller. When I asked if people were buying in the dip or selling in panic, she told me that they haven't had one ounce of gold sold back to them all day. She told me they have sold more gold in 24 hrs than they normally do in 3 months. Yes, there was a lot of extra security. The guy in front of me bought over $1 million in gold. He paid in cash and walked out of the door with the (gold) bullion in a nike bag. Amazing.”
U.S. Mint’s Sales of Gold Coins Soar After Futures Slump
The U.S. Mint in April has sold 153,000 ounces of American Eagle gold coins, the highest in almost three years. Sales have more than doubled from March and surged sevenfold from a year earlier, data on the Mint’s website showed. The amount for all of May 2010 was 190,000 ounce. The China Gold Association said that retail sales soared on April 15 and April 16, and the All India Gems & Jewellery Trade Federation said that demand climbed to the highest this year. Sales surged from Australia’s Perth Mint, which refines almost all of the nation’s bullion, Treasurer Nigel Moffatt said. He didn’t provide precise figures.
Gold Gaining as Physical Demand Said to Be ‘Extraordinary’
Gold extended gains above $1,400 an ounce on signs that jewelers and other users of the precious metal are taking advantage of the biggest slump in prices in three decades. The premium for metal on the Shanghai Gold Exchange is up to as much as $10, in Turkey it’s almost $20 and in Asia it’s about $5, Bernard Sin, head of currency and metal trading at bullion refiner MKS (Switzerland) SA in Geneva, said today by e- mail. Last week, the premium was about $1 in Asia and Dubai, he said. “Physical demand is extraordinary”
The Secret World of Gold
Thursday, April 18, 2013 at 9:00 p.m. on CBC-TV The Secret World of Gold is a documentary exploring the power and politics of gold, a precious metal with more allure and fascination than any other. Valued for its permanence, beauty and scarcity, people will lie, cheat, steal and kill in the name of gold.
Gold coin sales in January totaled 150,000 ounces, the highest since mid-2010. If the current sales pickup holds, April's total will be the most since the frenzied three months after the mint's bullion sales program was launched in 1986. Sales in October 1986 totaled a record 692,000 ounces.
Source: Wall Street Journal
US Mint Sells Record 63,500 Ounces Of Gold In One Day
According to today's data from the US Mint, a record 63,500 ounces, or a whopping 2 tons, of gold were reported sold on April 17th alone, bringing the total sales for the month to a whopping 147,000 ounces or more than the previous two months combined with just half of the month gone.
Japanese See Gold as Hedge Against Stocks and Yen
When he woke up to the news of a collapse in gold prices, Yujiro Yamashita, 63, made his way to the posh Ginza district of Tokyo to make his first purchase of the metal in 20 years.Mr. Yamashita and other contrarian, individual Japanese investors understand that gold is a volatile investment, but they say it is better than the alternatives.They cite worries that the new high-octane economic policies of Prime Minister Shinzo Abe, designed to shock the Japanese economy out of nearly two decades of deflation, might prompt a collapse in the yen, or that the recent rally in stock prices might fizzle; they also point to heightened tensions on the Korean Peninsula."Bank deposits generate virtually zero interest," Mr. Yamashita said as he bought two gold coins worth almost $5,000 on Tuesday with some of the money he had made from the recent sale of his house. "Stock prices have jumped like crazy, but there are concerns about the risk of war," he added. "So I try to buy gold when I can."
Eric Sprott: Why a gold bug won’t throw in the towel
“I’ve always imagined that gold would hit a new high by the end of this year, over $1,900, so that is what I think,” Mr. Sprott said in an interview Tuesday, with gold bobbing below $1,400 (U.S.) an ounce. He compared the current pullback to 2008, when the price of gold fell 30 per cent in eight months amid the financial crisis to $712 an ounce, only to rally to $873 by the end of the year and more than $1,900 by September 2011.
Golden times for Perth Mint
Gold sales from Perth Mint, which refines nearly all of the nation’s bullion, have surged after prices plunged, adding to signs that the metal’s slump to a two-year low is spurring increased demand. “The volume of business that we’re putting through is way in excess of double what we did last week,” Treasurer Nigel Moffatt said, without giving precise figures. “There’s been people running through the gate.”
Cyprus Finance Minister Sees Gold Sale Within Next Months
The Cypriot government plans to sell part of its gold reserves within the next months, a decision that needs to be approved by the country’s central bank, Finance Minister Haris Georgiades said. “The exact details of it will be formulated in due course primarily by the board of the central bank.”
Gold Record High in Yen - Rush to Sell Jewelery, Buy Coins and Bars
Soros’ yen “avalanche” would appear to have begun with the yen having fallen by 9.5% against gold in 5 trading days since last Thursday leading to record nominal highs in the yen at over 0.1577 million yen per ounce this morning.The higher gold prices have led to a curious anomaly in Japan where the public has again been selling gold in cash for gold schemes, often due to being under financial pressure, while some Japanese investors and savers have diversified into gold coins and bars both of which have seen an increase in demand in recent days.“We are seeing buyback from the general public," a physical dealer in Tokyo told Reuters and there are reports of shortages of coins and bars and premiums increasing on bullion coins.There are also reports of shortages of bullion coins and bars in Thailand and in Singapore where premiums on certain bullion coins which are legal tender and have favourable tax treatment, such as American gold and silver eagles, have risen due to tightness in the market and delays of three to four weeks for delivery. Ms. Nakamura, a 50-year-old mother of two, told the Wall Street Journal that she is considering buying some new gold, even as she is cashing in her old holdings due to financial needs. She said she has been roaming department stores checking the price of gold jewelry and surfing online to compare prices. "I didn't think the [store] prices now are that expensive.
TD Securities: Data Shows Chinese Saw Gold Pullback As Buying Opportunity
The data show that 72 metric tons of the metal that came into Hong Kong was re-exported directly to China without altering or processing. "This is just below the December record high of 89 tons, bringing the total tonnage to 272 tons in just the four months from November 2012 to February 2013, and corresponds to a slide in prices from $1,740/oz to $1,560/oz," says Mike Dragosits, commodity strategist. "The pattern certainly displays an even greater demand for gold by China during price pullbacks, aside from the general uptrend in demand following the 2011 major rally in gold prices. It appears to us that China's demand for gold has not wavered in the face of all the negativity in the market surrounding the end to the gold bull run and continues unabated during price pullbacks."
Cyprus Central Bank Denies Plan to Sell Gold
The Central Bank of Cyprus denied that it will sell 400 million euros ($525 million) worth of its gold reserves as part of the conditions to Europe's bailout of the island state. Aliki Stylianou, a spokesperson at the central bank told CNBC on Thursday that there was "no such thing being discussed." "The decision to sell the gold is a decision to be taken by the board of the Central Bank of Cyprus (CBC). No such thing has been discussed or is in the process of being discussed. There are so many rumors flying about and this is just one of them," she said.
China Gold Imports From Hong Kong Rebound on Decline in Prices
Gold imports by China from Hong Kong jumped 89 percent in February, rebounding from a decline the month before, as lower prices lured buyers seeking the metal for a protection of wealth.Mainland buyers purchased 97,106 kilograms (97 metric tons), including scrap, from 51,303 kilograms in January, according to figures from the Hong Kong government yesterday. That's the fourth highest monthly total on record, according to data compiled by Bloomberg. Net imports, after deducting flows from China into Hong Kong, were 60,947 kilograms, from 19,580 kilograms a month earlier, and the highest since December.
Silver ETFs King of Q1 2013
Silver ETFs saw the strongest inflows of any single commodity in the first quarter of 2013, a recently released quarterly commodities report from ETF Securities reveals. Specifically, net new buying of silver products totaled $875 million as investors rotated into cyclical assets. North Americans were the top investors in silver ETFs in Q1, spending $732 million compared to Europe's $126 million. However, both regions clearly preferred the white metal over gold. But the data reveals that sentiment toward silver had not cooled off by the end of the quarter. "What's interesting is that the trend [of outflows from gold, inflows into silver] was really for the first 10 weeks of the year. But in the middle of March, once the Cyprus situation blew up and we started to see inflows back into the gold ETFs, we started to see outflows from the more cyclically oriented commodities, including silver," Brooks said.
Comex Gold Inventories Collapse By Largest Amount Ever On Record
A stunning piece of information was brought to my attention yesterday. Amid all the mainstream talk of the end of the gold bull market (and the end of the gold mining industry), something has been discretely happening behind the scenes.Over the last 90 days without any announcement, stocks of gold held at Comex warehouses plunged by the largest figure ever on record during a single quarter since eligible record keeping began in 2001 (roughly the beginning of the bull market). See chart below. Total drainage of physical inventories reached nearly 2 million oz.'s of gold, which at today's prices represent roughly $3,000,000,000 dollars. According to chart sage Nick Laird, this data indicates that, "Eligible stocks which are owned in LBMA/Comex good delivery form are being drawn down-which means they are being removed from the warehouses. As to how and why they are [being] removed, that is a mystery. [Up until now], eligible stocks were on the continual increase throughout the bull market. Now that trend has changed."
Hulbert Gold Sentiment at Record Lows
If you are sick and tired of reading Precious Metals sentiment updates on this blog, I do not blame you. As an author of a contrarian blog, my job is to report as an objective view as possible of sentiment indicators developing within the various asset classes. Right now, it seems that Gold is one of the few assets experiencing negative extremes worthy of attention, from a contrarian point of view. As I analyse the current market conditions, one of the only asset classes I tend to prefer today is the Precious Metals sector. I recent weeks I have hinted at the extremely depressed sentiment including the following important indicators: In early March COT reported Gold short positions reached the highest level in over a decade In early March Gold's Public Opinion reached one of the lowest levels in at least a decade Last week COT reported Silver short positions reached the highest level in almost two decades Last week Silver's Public Opinion reached one of the lowest levels in at least a decade. The latest development worthy of "decade extreme" or "record extreme" within the Precious Metals sector, comes to us thanks to Mark Hulbert Financial Digest. According to Mark's latest WSJ column, there has been a huge plunge in exposure of various Gold newsletter advisors.
Volcker: Central banks are too aggressive
Former Federal Reserve chairman Paul Volcker warned Monday about potential dangers from what he calls "unorthodox" and aggressive moves by central banks around the world.Central banks, including the Fed, could eventually inflict more harm by "what they're doing with their portfolio to save the world economy…Central banks are no longer central banks," said Volcker. "I think it gets dangerous when they lose sight of the basic function of the central bank." Volcker said that rather than trying to stay out of the market as much as possible and simply tinker from the sidelines, central banks have been aggressively trying to influence economic growth and even inflation…
US Mint Sells Nearly 1 Million Silver Eagles Monday, Begins Rationing Sales!
US Mint has updated April sales statistics for the first time since last week, and to no surprise, the Mint again reported more massive sales, with another 833,000 silver eagles reported sold Monday! The April total through 6 business days is now 1.645 million ounces, bringing the 2013 total to a massive 15.868 million ounces.In response to the continued massive demand for silver eagles, the mint also has begun rationing sales of silver eagles to primary dealers resulting in supply delays!Just as was seen in January, tight physical supplies have seen premiums on ASE’s skyrocketing over the weekend and throughout the day, as ASE’s are rapidly becoming as scarce as 90%!
Chart of the Day: Silver Shorts Surge
Today’s chart refocuses on the precious metal sector and in particular investor positioning towards Silver. Hedge funds and other speculators are now so negative on the metal, that the short positions have reached the highest level in the last 17 years (possibly even longer).So what does this mean?Judging by the historical price action over the last two decades, whenever speculators have held such enormous bearish positions, the price of Silver was either at or near a major low. Consider the following: As short bets reached 44,790 in 1997, a huge short squeeze doubled the price in coming months In 2000 and 2001 short bets reached over 44,000 triggering the start of a secular bull market Finally, short bets reached 45,163 in 2005 as Silver broke out, rallying for almost three years.
Jobs Report Reinforces Fed Wariness About Premature End to QE3
Friday’s jobs report shows that talk of an early end to the Federal Reserve’s bond-buying programs might have been premature.Fed officials have said they would continue buying long-term Treasury and mortgage bonds until the employment outlook improves substantially. One Fed official this week raised the possibility of a job market strong enough by summer to begin pulling back from the program. But the Labor Department report released Friday could raise doubts inside the Fed about how quickly the job market is healing and deflate that hope.
South Africa, Russia working on platinum 'task team'
South Africa and Russia, the world 's largest producers of platinum and palladium, are working together on a "technical task team" to ensure future demand for the platinum group metals."We are very worried about the future of the platinum industry. This cooperation will look at research and market development," a spokesman for South Africa's mineral department was reported as saying by the Wall Street Journal.South Africa accounts for around 80% of the world's mined platinum and Russia about 40% of mined palladium.
Fed Is Weighing a Reaction to Stirrings of Recovery
Some Fed officials have suggested in recent weeks that if economic growth continues on its present trajectory, the central bank should begin to roll back its economic stimulus campaign by the middle of the year, ahead of expectations. But the Fed’s chairman, Ben S. Bernanke, and his allies remain wary that another surprising spring will be followed by another disappointing summer. Janet L. Yellen, the Fed’s vice chairwoman, who is viewed as a potential successor to Mr. Bernanke, reflected that caution in a speech on Thursday. “I am encouraged by recent signs that the economy is improving and healing from the trauma of the crisis, and I expect that, at some point, the F.O.M.C. will return to a more normal approach to monetary policy,” she said, referring to the Federal Open Market Committee, which sets policy for the central bank. For now, she said, the Fed needs to remain focused on reducing unemployment.“In my view,” Ms. Yellen said, “adjusting the pace of asset purchases in response to the evolution of the outlook for the labor market will provide the public with information regarding the committee’s intentions and should reduce the risk of misunderstanding and market disruption as the conclusion of the program draws closer.”
Bank Of Japan Gives 'Perfect Answer' With Its New Massive Monetary Easing Plan
The Bank of Japan shocked markets on Thursday with a radical overhaul of its policymaking, adopting a new balance sheet target and pledging to double its government bond holdings in two years as it seeks to end nearly two decades of deflation. At Governor Haruhiko Kuroda's first policy-setting meeting, the central bank shifted its policy target to the monetary base -- the total size of cash and bank deposits -- from the overnight call rate, which is at zero to 0.1 percent. The decision marks a return to the BOJ's five-year quantitative easing policy that ended in 2006, when it flooded markets with cash targeting excess reserves that financial institutions parked with the central bank. To meet its new 2 percent inflation target, the central bank will boost asset purchases to double its holdings of government bonds and exchange-traded funds(ETF) in two years. In doing so, it will revert to open-ended asset purchases and buy over 7 trillion yen ($75 billion) of long-term government bonds per month, so that the balance of its bond holdings increase at an annual pace of 50 trillion yen. "The BOJ will conduct money-market operations so that the monetary base will increase at an annual pace of about 60 trillion yen to 70 trillion yen," the BOJ said in a statement announcing the decision. The monetary base is expected to expand to 200 trillion yen this year and to 270 trillion yen by the end of 2014, almost doubling from 2012 when it was 138 trillion yen, the BOJ said.
Why the PGM space is like uranium 10 years ago - Rule
Rick Rule believes the combination of lower grades, labor strife and inefficient mines with the relentless demand could pay off for platinum and palladium investors. An interview with The Metals Report.
Q1 2013 US Silver Eagle Sales Beats All Records
Only a week ago, we wrote how the physical silver investment demand is historically high. We got to that conclusion based on the physical holdings of all silver ETF’s combined, as well as the 2013 US Silver Eagle coin sales.Today’s US Mint figures show an astonishing increase of almost a million ounces over the past week. March 2013 stands now at 3,356,500 silver ounces sold. Replace the latest figure in the above table with the most actual one, and it becomes clear how this is the best first quarter ever (the figures before 2008 were consistently lower). Now we did an easy but interesting exercise. The first quarter of 2013 saw sales of 14,2 million ounces of US Silver Eagles. We compared this Q1 2013 figure with the total of each year since this giant gold & silver bull market started in 2001. The comparison needs no additional comment (but readers should feel free though to comment in the section below).
Getting Socked By Gold Fund Taxes? Consider These CEFs
Around this time each year, investors who own commodity funds without doing the (admittedly non-trivial) tax homework get a rude surprise.Gold exchange-traded funds are one example. An investment held for more than a year is treated as a collectible — as if you’re selling some prized coins. The applicable tax rate on a gain in the SPDR Gold Trust (GLD) in such cases is 28%.Morningstar’s Samuel Lee takes a look at this subject and others in connection with the SPDR gold fund today, offering a few alternatives for the tax-averse. Specifically, closed-end funds.First, on the GLD tax issue: As far as U.S. federal taxes go, the trust is treated as a “grantor trust,” meaning your ownership is taxed as if you owned the gold bullion directly. If you sell within a year of buying, your gains are taxed at ordinary income rates. Beyond a year, bullion, alas, is taxed at a special collectibles rate, which as of writing is 28%.And here are those CEFs:Intriguingly, U.S. investors in Canadian gold closed-end funds may be able to sidestep the 28% collectibles tax rate. The two biggest such funds are Sprott Physical Gold Trust Common (PHYS) and Central GoldTrust Common (GTU). Both funds are “Passive Foreign Investment Companies” for U.S. tax purposes, allowing unitholders to make a “Qualified Electing Fund” election each year. Under this tax treatment, the CEFs are taxed as if they were U.S.-based mutual funds, according to Moskowitz LLP, meaning capital gains on shares held for longer than a year are taxed as long-term capital gains. Of course, you should consult your tax advisor before you pursue this path.
Central Banks Bought More Than $3B In Gold In 2013: UBS
Data compiled by UBS shows central banks bought about 54 metric tons of gold in the first two months of the year; that’s more than 1.9 million ounces, or more than $3 billion at Wednesday’s prices (bullion stood at $1,606.30 an ounce by 3:36 PM in New York). South Korea, for example, announced it a purchase for 20 metric tons in February, while Russia is 19.2 metric tons deep in 2013. Other buyers include Kazakhstan (6.6 metric tons), Indonesia (1.9 metric tons), Bosnia and Herzegovina (1 metric ton), and Azerbaijan, which bought 2 metric tons after having zero gold reserves in over a decade.
Santelli On The End Of Paper Gold's Reign
Central Banks remain aggressive accumulators of the precious metal as we noted last night, as their actions outweigh their words; but as CNBC's Rick Santelli notes today, there is a big difference between the physical bullion they are buying and the 'gold bug' trading currently going on in our markets: I don't even look at gold as gold anymore since they securitized it. If things [went] badly in the world that I used to observe (as a gold bug); the gold would end up in the hands of the gold bugs. If things go badly now, they're going to end up with checks from ETFs! Sorry, it's not the same. The reign of [paper] gold as the Ayn Rand endgame, to me, that's over. Game, Set, Match.Which likely explains the incessant demand for precious metals from the US Mint over the past few months - as the other great rotation (from paper to physical) proceeds.
Rick Rule draws three profound lessons from the Cyprus debacle
"1) That ultimately, given the leveraged nature of the system, deposit insurance is just another social promise that won't be able to be kept.
"2) That the regulators are completely incapable of balancing their own budgets, never mind managing a business as complex as banking.
"3) You need to have some of your assets outside of the system. You need to own some things that they can't print and regulate. And my nominations for those things would be bullion -- gold, silver, platinum, or palladium."
Americans Start New Gold Rush: CNBC Survey
Gold fever continues to grip the nation. The CNBC All-America Economic Survey finds that Americans once again chose gold as the top investment choice, beating out real estate, stocks, savings accounts and bonds. The poll of 800 Americans finds that 35 percent picked gold as their best investment choice, down from 37 percent a year ago, but still beating real estate, which was the top pick of 27 percent of the public. That was followed by 21 percent who chose stocks.
Russia, South Africa Seek to Create OPEC-Style Platinum Bloc
Russia and South Africa, which together control about 80 percent of the world’s reserves of platinum group metals, plan to create a trading bloc similar to OPEC to control the flow of exports. “Our goal is to coordinate our actions accordingly to expand the markets for realization of these metals,” Russian Natural Resources Minister Sergey Donskoy said yesterday in an interview at a summit of leaders from Brazil, Russia, India and South Africa in Durban. South African Mines Minister Susan Shabangu confirmed that the two countries aimed to counter oversupply of platinum, and said possible measures could include taxes and incentives.“We’re not really controlling the market,” she said in an interview in Durban. “We want to contribute without creating a cartel, but we want to influence the markets.”Other platinum producers will be invited to join the bloc, which will be similar to the Organization of Petroleum Exporting Countries, Donskoy said. The aim will be to open up new markets rather than limit exports, he said.
Russia raises gold holdings for 4th month in February: IMF
SINGAPORE: The Russian Federation raised its gold reserve for a fourth straight month in February and Turkey added to its holdings for a third month, data from the International Monetary Fund showed on Tuesday.Russia added 6.998 tonnes of gold to its reserve, which stood at 976.952 tonnes by the end of February, reinforcing its ranking of holding the world's eighth largest official gold reserve."The continuous increase in gold holdings of central banks, especially those in developing countries, has been giving some support to gold, which is under pressure from the improving economic outlook," said Li Ning, an analyst at Shanghai CIFCO Futures.Gold, Besides Russia and Turkey, Kazakhstan, Azerbaijan, Belarus, Kyrgyz Republic, Mongolia and Ukraine also bought gold for their official reserves in February.
Insider buying of gold stocks surges to multi-year highs
According to INK Research, there are now seven precious metals stocks on the TSX with insider buying for every one with selling. That’s a near doubling of the ratio since mid-January – and represents a level of lopsided transactions that is usually only seen during major market peaks or valleys. “That is the type of insider buying we saw in the broad market during the height of the great financial crisis in late 2008 and early 2009,” points out Ted Dixon, CEO of INK Research. “A similar situation now seems to be in place among gold and silver miners.”
11 Billion Reasons to Expect a 200% Move in Gold Stocks Within Months
How does the prospect of making 200% in twelve months sound to you? Far-fetched? Well this is exactly what happened for gold stock investors between 2008 and 2009. The HUI gold stock index was intensely oversold in October 2008, and went on to soar 200% over the next year. That was back then, of course. But right at this very moment we’re looking at a near identical set up in the markets. Gold stocks are just as unloved and oversold. They’re at similar relative valuations. It won’t take much of a catalyst to see a serious move from here. And it’s certainly not just me banging the golden drum today… Last week in Hong Kong for the Mines and Money conference, I was extremely lucky to score a meeting with and interview keynote speaker and legendary precious metals expert, Eric Sprott… An Investing Legend. Eric Sprott is the CEO and Senior Portfolio Manager of Sprott Asset Management, currently managing $11 billion in the precious metals markets.
Bernanke: QE is an ‘enhance-thy-neighbor’ policy
The Federal Reserve’s bond-buying program is an “enhance-thy-neighbor” policy and not designed to spark a competitive devaluation of the dollar, Fed Chairman Ben Bernanke told an international audience on Monday.Finance ministers of many emerging market economies have complained about the easy policy stance in the U.S., saying it could was a modern-day equivalent of the “beggar-thy-neighbor” policies of the 1930s.But in a speech at the London School of Economics, Bernanke said that almost all G-7 industrial countries have similar easy monetary policy stances, which should mute any currency moves.“To the contrary, because monetary policy is accommodative in the great majority of advanced industrial economies, one would not expect large and persistent changes in the configuration of exchange rates among these countries,” Bernanke said.“Moreover, because stronger growth in each economy confers beneficial spillovers to trading partners, these policies are not “beggar-thy-neighbor” but rather are positive-sum, “enrich-thy-neighbor” actions,” Bernanke said.
FOCUS: Swiss Feb. Palladium Exports Most In 4 Years; Some Describe Trade Data As Bullish
Switzerland’s exports of palladium in February were the highest in four years and dwarfed imports, with much of the metal headed to the U.K. and presumably into vaults for investment demand, analysts said. One firm, TD Securities, said the data on balance points to “quite a tight supply picture” and supports its bullish call for the metal. “There is not as much metal coming into Switzerland as we’re used to seeing,” said Afshin Nabavi, head of trading with MKS (Switzerland) SA. “To me, that is more bullish news than bearish news. Imports did pick up. It’s still low, if you compare it to the numbers of last year and the year before.” Converting to ounces, Standard said that net exports in February were 489,383 ounces in February, compared to 44,696 in January. “By far the largest share of these exports went to the U.K., with 498,185 ounces moving to London vaults — as a consequence of investor-related flows,” said Marc Ground, commodities strategist with Standard. “On the import side, metal coming into Switzerland remains virtually non-existent as the historic supplier, Russia, has all but disappeared and speculation continues to mount that state stockpiles have diminished to near nothing, lending further support to prices into 2013,” Dragosits said. “TDS continues to favor palladium as the metal most likely to outperform all others.”
New platinum CEOs to navigate choppy waters
“Their best bet would be to cut output and re-establish profitability. However, they would need to get buy-in from government and labour — both of which seemed almost impossible to get in the year preceding the national election.“We’ve seen a lot of talk, but none of the desperately needed walk. Less output will be the first positive sign that the platinum group metals market is turning. Until then don’t expect any good metal price moves,” said the London analyst.Share prices of platinum companies took a pounding over the past two years, according to data supplied by Cadiz Mining Consultants.Amplats saw its share price drop by 43% since the start of January 2011 from R69.40 to R39.49 this week. Similarly, Implats lost 41.2% of its share price value from R23.49 at the start of 2011 to R13.69.The biggest losers were Lonmin and Aquarius, losing 61.3% and 86.45% of their share price value respectively over the same period.
Biggest Crisis Since 2008 Looms for South African Mines: Energy
South Africa’s mining industry, backbone of the continent’s biggest economy, is heading for its worst electricity shortage in five years in a threat to platinum and gold production and to the rand currency. State-owned Eskom Holdings SOC Ltd. is straining to meet demand from a growing economy as consumption is set to swell when the Southern Hemisphere winter drives the need for heat. Faults at a nuclear power plant near Cape Town are crimping supply, while imports are reduced because of flooding in Mozambique. “We do see a significant risk of power shortages,” Shaun Nel, director at the Energy Intensive User Group of Southern Africa, whose 32 members include the local units of BHP Billiton Ltd. (BHP) and ArcelorMittal. (MT) “We are seeing a significant number of factors that point to a system in distress.” A repeat of the January 2008 blackouts that halted Anglo American Plc (AAL) mines for five days and paralyzed factories would imperil South Africa’s 2013 growth forecast of 2.7 percent. The rand dropped to a four-year low this week, partly on concern that disruptions to mining will cut exports from the holder of the biggest-known reserves of platinum and chrome and fifth- largest gold producer.
Tarrant lawmaker seeks to create Texas Bullion Depository
Call it the Rick Perry gold rush: The governor wants to bring the state's gold reserves back from a New York vault to Texas. And he may have legislative support to do it. Freshman Rep. Giovanni Capriglione, R-Southlake, is carrying a bill that would establish the Texas Bullion Depository, a secure state-based bank to house $1 billion worth of gold bars owned by the University of Texas Investment Management Co., or UTIMCO, and stored by the Federal Reserve.
Swiss To Vote On Gold Repatriation
The Swiss National Bank (SNB) ... currently holds about 1,040 tons of gold reserves after gradually selling off at least 1,550 tons and now members of the Swiss People's Party, the far-right Swiss Democrats and the Lega dei Ticinesi movement, is confident a nationwide vote will be called (after they gathered 106,000 signatures) on stopping the sale of gold reserves held by the SNB. It also wants gold bars stored in the US to be returned.
Swiss PGM Data Suggest Russian Shipments Rise In Feb – Barclays
Switzerland trade data released Thursday show Russian palladium shipments of around 9,600 ounces in February, higher than the 6,400-ounce average seen during the fourth quarter of 2012 and the absence of shipments in January, says Barclays. They caution on reading too much into the stronger February data, saying that the “subdued shipments over the past year still suggest a much tighter supply picture for palladium.” Total palladium shipments to Switzerland more than doubled month-over-month, rising by 6% year-over-year, to 46,000 ounces, they say. The country remained a net exporter of palladium; exports jumped to 552,000 ounces in February, with nearly 514,000 ounces shipped to the United Kingdom. Total platinum shipments to Switzerland rose by 9% year-over-year to 107,000 ounces, almost doubling month-over-month. Switzerland remained a net importer of platinum, as platinum exports fell by 2% month-over-month and 53% year-over-year to 94,000 ounces, they say.
U.S. Fed keeps firm on aggressive stimulus even as job market improves
The Federal Reserve on Wednesday pressed forward with its aggressive efforts to stimulate the U.S. economy, saying it would take into account risks posed by its policies but also how much progress it was making lowering unemployment. Meeting just as turmoil in Europe took another turn for the worse, the central bank nodded to brighter economic signs in the United States but dropped a reference from its last policy statement that global financial strains were easing.“The committee will continue to take appropriate account of the likely efficacy and costs of such purchases as well as the extent of progress toward its economic objectives,” the Fed said in a statement after a two-day meeting.
India central bank may ban Gold coin sales by banks
The move is a clear indication that the central bank extending it's fight against gold to another level and likely to prevent banks from selling gold coins in near future . RBI early this week said it has undertaken a thematic study in respect of banks that are active in selling gold coins or wealth management products to examine whether there are systemic issues and to plug deficiencies and legal loop-holes, if any.
Gold Use in India Gaining May Weaken Attempt to Curb Deficit
Consumption may total 865 metric tons to 960 tons this year, compared with 864.2 tons in 2012, Somasundaram P.R., managing director of the World Gold Council for India, said in an interview in Mumbai. The gain in imports will match the increase in demand, he said. The country imported 860 tons last year, according to data from the council.
Platinum May Retest High After Double Bottom: Technical Analysis
Platinum may rise 4 percent to challenge this year’s high reached in February after forming a “double bottom,” according to Hiroyuki Kikukawa of Nihon Unicom Inc.
Do Western Central Banks Have Any Gold Left??? Part II
The past few months have been difficult for the gold investor as selling pressure in the gold futures market has set a decidedly negative direction for the price of the yellow metal. As fundamental investors, we always pay special attention to the supply and demand dynamics of gold and, recently, we have found it very difficult to reconcile lower prices with continued strong demand for physical gold. While the supply of gold has remained largely static, we have seen a steady increase in demand for the yellow metal. India and China have emerged as strong buyers, consuming over half of the mine supply in recent years. Central banks have switched from being sellers of gold to being net buyers, with their gold purchases in 2012 increasing by 17% to almost 535 tonnes. Exchange traded products (ETPs) around the world have continued to add to their gold hoards, as have institutions and private investors. Furthermore, central banks, such as South Korea and Russia, have added to their bullion reserves early in 2013, which points to sustained strength in demand. These facts are important because, over the past decade, the annual supply of gold has stayed flat at approximately 4,000 tonnes.
SPDR gold fund reports first net inflow in 6 weeks
The world's largest gold-backed exchange-traded fund, SPDR Gold Shares, said its holdings rose 0.22 percent to 1,222.16 tonnes on Tuesday, its first one-day net inflow in nearly six weeks. In volume terms, its holdings rose to 39.293 million ounces from 39.207 million ounces the previous day, their lowest level since July 2011.
Credit Growth Imperiled as Gold Lures Deposits: Corporate India
Indian banks are struggling to attract deposits to fund credit growth amid the slowest economic growth in a decade as customers buy assets such as gold and real estate to protect themselves against inflation. The credit-to-deposit ratio at lenders led by State Bank of India widened at the end of last month to almost 79 percent, or the highest since the central bank began reporting the data in 1998. Meanwhile, physical savings including gold imports, which slumped to 45 percent of household assets in the 1990s, may end this month at about 66 percent, Vishal Narnolia, a Mumbai-based analyst at SMC Global Securities Ltd. (GLBS), estimated.Indians have stashed 18,000 tons of gold in jewelry, coins and other forms, according to the website of Manappuram Finance Ltd. (MGFL), which extends loans secured by gold. Such a hoard would be worth about $923 billion at current international prices, compared with India’s $1.35 trillion banking system. ICICI Bank estimates the nation’s households hold $1.1 trillion of gold.
BIS concerned markets getting hooked on stimulus
"The fact that market dynamics have become ever more dependent on central bank and government stimulus is a cause for concern," Stephen Cecchetti, BIS economic adviser and head of the monetary and economic department, said in a conference call, presenting the BIS quarterly report on Sunday.
SA mining output rises
South African mining production rose 7.3% in January' marking the sector's first month reflecting a year-on-year increase since September 2012' although Nedbank - one of the country's "big five" banks - warns of a tough road ahead. Iron ore was the main contributor to the overall 7.3% production increase' accounting for 4.8 percentage points of the rise' with diamonds and coal each contributing 1.1 percentage points. On the down side' gold pulled the number down by 1.3 percentage points' with the "other metallic minerals" category was the only other negative contributor' at 0.7 percentage points.
Mechanisation for SA platinum mines a distant prospect
Rising wage costs and strikes have revived the arguments in favour of automating South Africa's loss-making platinum mines, but weak prices for the metal and tough conditions underground mean mechanisation remains a distant prospect. The rest of the mining industry, from copper to coal, has been transformed in recent decades by automation, unmanned trucks and remotely controlled equipment. That is in large part thanks to geology. In the cramped mines where platinum is found, the rock is still drilled, blasted and cleared by men. The platinum seams are damp, sweltering and claustrophobic places to work: men often drill in shafts so constricted that it is like mining under a table.
Recycling, not mining the future for PGMS - Lifton, King
According to Jack Lifton, and Byron King, the biggest new source for platinum group metals just might be what Jack Lifton calls "the rubber tire mine." An interview with The Metals Report. The Metals Report: Jack, what is behind the predictions that the platinum supply surplus will become a 400,000-ounce (400-Koz) deficit?Jack Lifton: The world's largest platinum and rhodium producer, has taken 400,000 Koz of platinum out of its 2013 schedule for its South African mines. While people might not think 400 Koz is very much, you have to keep in mind that in 2012, the total production of all of the platinum group metals (PGMs) was less than 700 tons. One ton of precious metal has 30,000 or 31,000 troy ounces of material, troy ounces being the traditional measurement in precious metals. That 400-Koz reduction equals 10–13 tons and represents as much as 2% of world production. Global production has been declining from its peak of 320 tons in 2006, and in 2012 was down to 300 tons. This is a serious reduction in a metal that is extremely rare.
U.S. dollar’s share of central bank reserves falls to 54% in 2012: World Gold Council
As the world’s central banks look to diversify their reserve portfolios, they’re cutting back on U.S. dollars and the euro and buying more gold, Japanese yen and Chinese yuan, according to a report released Wednesday from the World Gold Council.The U.S. dollar’s share of total reserves fell from 62% in 2000 to 54% in 2012, according to the report.Official reserves of global central banks grew to more than $12 trillion in 2012, from $2 trillion in 2000, the WGC said. Data showed a significant shift away from the U.S. dollar over that 12-year period, and the share of “other” currencies in reserves has tripled in absolute terms since 2008, it said. Central bank gold buying in the fourth quarter of 2012 marked the eighth straight quarter of net purchases by the official sector and the highest level since 1964, the WGC said. Gold’s percentage of total central reserve holdings remained constant at 13% between 2000 and 2012.“Building gold reserves in tandem with new alternatives is an optimal strategy as central banks remain under-allocated to gold and many attractive alternatives are either too small or, as is the case with the renminbi [also known as the yuan], not yet open to broader international participation,” said Ashish Bhatia, manager for government affairs at the WGC.
China May Limit Gold to 2% of Foreign Reserves, PBOC’s Yi Says
“If the Chinese government were to buy too much gold, gold prices would surge, a scenario that will hurt Chinese consumers,” Yi said today in a press briefing in Beijing. “We can only invest about 1-2 percent of the foreign exchange reserves into gold because the market is too small.”The nation’s reserves, which have surged more than 700 percent since 2004, surpassed the value of all official bullion holdings in January 2004 and rose to $3.3 trillion at the end of 2012, data compiled by Bloomberg show.
China's gold reserves stand at 1,054 tonnes
Vice governor of the People's Bank of China (PBOC) Yi Gang said Wednesday that the country's gold reserves now stand at 1,054 tonnes, adding that a massive increase is unlikely in the future."We need to take into account both the stability of the market and gold prices," Yi said when asked about whether China will increase the size of its gold reserves at a press conference held on the sidelines of the legislature's ongoing annual session.As the world's largest gold producer and importer, China produces about 400 tonnes of gold annually, as well as imports 500 to 600 tonnes of gold every year, according to Yi.
What, If Anything, Do Rising Silver Coin Premiums Foretell?
Silver dealers with a national reach are less affected by local market conditions, but they too have seen rising silver coin premiums, the latest evidence of such coming from USAGold in an email yesterday: Greetings clients and friends, Supply shortages continue in the physical silver market. Junk silver bags ($1000 face value combinations of silver quarters, dimes and half dollars) have all but disappeared. What was once the 'cheap way' to buy bulk silver has seen premiums jump to over 10% over melt. Meanwhile, the U.S. mint is rationing silver Eagles, pushing delivery times out to a month+ for all orders...
German Central Bank Doubles Reserves
FRANKFURT — In a profound signal of uneasiness about the health of the euro zone, the German central bank said Tuesday that it had nearly doubled the reserves it held to cover possible losses.The Bundesbank said it had raised its risk provisions, or the money it sets aside to cover losses like a default on euro zone bond holdings, to €14.4 billion, or $18.7 billion, from €7.7 billion a year ago. The bank’s profit for the year, which it transfers to the German government, was little changed, rising to €664 million from €643 million. “The crisis is not yet over despite the interim calm on financial markets,” Jens Weidmann, the Bundesbank president, said during a news conference.
Silver Investment Demand Surges 30% As Silver ETF Holdings Robust
Silver is outshining gold in the market for exchange-traded products as global demand for the white metal gets a boost from industrial consumption amid signs of an economic recovery, CPM Group Inc. said.The Bloomberg Chart of the Day shows silver tonnage in exchange- traded funds backed by the metal rose for four straight months, while holdings for gold ETPs dropped in January and February. Silver futures may jump 20 percent this year to $34.50 an ounce from yesterday's settlement of $28.808 in New York on investment demand and industrial use, said Rohit Savant, a senior commodity analyst at the New York-based research company."People have been buying silver both as a base and precious metal," Savant said in a telephone interview with Bloomberg. "Economic demand will push prices higher." Holdings in silver ETPs rose 3.6 percent in the two months ended Feb. 28, reaching a record 19,699 metric tons on Jan. 18, data compiled by Bloomberg show. Last month, assets in gold ETPs fell 4.1%. Sales of American Eagle silver coins by the U.S. Mint jumped to a record in January and more than doubled in February from a year earlier, the Mint's website showed. China's imports of the metal surged 14% in January, the biggest monthly gain since July.
Gold bar sales in China jump twofold during Spring Festival
Sales of gold, silver and jewellery pieces at the monitored establishments increased 38.1%. Though the Ministry did not identify bullion sales in value terms, it said the gold, silver and jewellery market reached a high consumption peak during the period.
Market Nuggets: UBS: Palladium Benefits From Prospects For China Emissions Control
Palladium has been boosted by calls at the National People's Congress to address air pollution in China, says UBS. "The emphasis on environmental issues bodes well for PGMs (platinum group metals), particularly palladium, as this translates into tighter emissions standards, which would in turn require auto catalysts with higher PGM loadings," the bank says. There is upside potential for palladium in the coming years since the gap between China's current standards and those of the developed world remains large, UBS says. Further, Chinese auto sales have been strong so far this year, the bank adds.
Private gold investors less bearish than funds in Feb -survey
London-based BullionVault, an online physical gold and silver market for individual investors, said its Gold Investor Index dipped to 54.4 in February from 54.9 in January. February's figure marked the lowest reading since September 2012. A number above 50 indicates more buyers than sellers.
Barron's: How to Play the Battered Gold-Mining Stocks
The gold-miner selloff, meanwhile, has left many looking cheap—but for good reasons, considering the uncertain outcome of their transformation. Investors willing to take risks should focus on the ones that have low costs, free cash flow—or will have it soon—and operate in more stable countries, says Avy Hirshman, a portfolio manager at Newgate Capital Management. His favorite: Canada's Yamana Gold (AUY), which operates in Brazil, Chile, Mexico, and Argentina. The company's cost of production is about $500 an ounce, well below South African miners' $800-plus, and it has been cutting its capital expenditures. Yamana had free cash flow from operations of $509 million during 2012's third quarter.
American Gold Eagle Bullion Coins Continue Winning Streak
Although sales of the United States Mint's American Gold and Silver Eagle bullion coins showed declines from the seasonal spikes seen in January, monthly sales levels were significantly higher compared to the year ago period. For the month of February 2013, American Gold Eagle bullion sales reached 80,500 ounces, across the four different sizes available. While this was down from the prior month when 150,000 ounces were sold, the amount is nearly quadruple the sales of 21,000 ounces recorded in February 2012. This also marks the fifth consecutive month that Gold Eagle bullion sales have exceeded the level of the year ago period.For February 2013, Silver Eagle bullion sales reached 3,368,500 coins. This amount was more than double the sales total of 1,490,000 which had been recorded in the year ago period. The latest monthly sales figure is down form the prior month total when a record breaking 7,498,000 coins were sold.
Silver Demand Surges To Record For February
We noted the strange divergence between the surge in physical demand for precious metals and the falling price of gold and silver yesterday and today; sure enough, just as they give back some short-term gains, we find that with one day left in the month, the US Mint has seen the largest demand for physical silver coins ever for a February at 3.37mm ounces. We are sure this all makes perfect sense somewhere in the leasing, backwardation, securitization, paper world of precious metals pricing but one thing appears sure, more than just Russia is backing up the truck for physical bullion.
Gold sales went "insane" on price dip, Coin Week tells Fox Business
Physical buying exploded on "buying opportunity" under $1,600, says exec David Lisot "The United States government sells the American gold Eagle and they release monthly numbers," David Lisot of Coin Week tells Fox Business in a Feb. 26 interview. "The numbers dropped off in the sales in December, which is typical during the holidays. January they were up over a 150,000 ounces. February's only halfway though -- they have over 60,000 ounces sold so far.
Mexico's audit office tells Bank of Mexico to verify gold held at Bank of England
Mexican financial journalist and agitator for accountability in government Guillermo Barba reports today that the Mexican government audit office has reprimanded the Bank of Mexico for failing to verify its supposed purchase of $4.5 billion of gold vaulted at the Bank of England. The audit office confirms Barba's complaint last year that the Bank of Mexico had purchased only "paper gold" at the Bank of England and had no idea of the number of bars it had supposedly purchased, nor of the purity of the bars.Barba writes that the audit office has recommended that the Bank of Mexico "make a physical inspection with the counterparty that has the gold under its custody, in order to be able to verify and validate its physical wholeness and the compliance with the terms and conditions of dealing with this asset." Barba adds that the Bank of Mexico does not want to do this but wants to trust the Bank of England not to play games with Mexico's gold.
Corrected-Commodities-Gold jumps as Fed Chief defends stimulus; oil slips
Bullion price jumps 1.8% as Fed chief defends stimulus program in Senate testimony.Gold's biggest rally in months stretched into a second day on Tuesday after the U.S. Federal Reserve chief defended the stimulus program that has stoked gold buying on inflation worries, but oil fell on concern about Italy's elections. ...Gold jumped 1.8 percent for its sharpest one-day gain since Nov. 6. In Monday's session, it rose nearly 1 percent for its biggest advance since Oct. 1.
Traders Bet Silver Will Shine
Silver has been weak for a long time, but yesterday the bulls were jumping in.The option paper hit in the ProShares Ultra Silver fund, which is double-leveraged to the price of the metal. More than 2,300 March 42 calls traded in a heavy buying pattern for $0.95 and $1 in volume well above the strike's previous open interest of 678 contracts, indicating new activity, according to OptionMonster's tracking systems.
Market Nuggets: ETF Securities: Investor Interest Persists In PGMs Despite Price Retreat
Investor interest for platinum group metals still appears strong, says ETF Securities. Despite a retreat in prices last week, platinum exchange-traded-product holdings remain at an all-time high, the firm says. "The fundamental outlook for PGMs remains solid, particularly palladium," the ETF provider says. "With South African supply disruptions a persistent threat and auto-catalyst demand showing signs of recovery, palladium appears well placed for gains. The latest Swiss statistics confirmed market suspicions that Russian palladium stocks might be close to exhaustion, as Russian exports of the metal were zero last month."
Huge gold short position detailed in Commitments of Traders
Analysts pointed out some interesting developments in the Commitments of Traders report released by the U.S. Commodity Futures Trading Commission. “The producer merchants, the category that includes the natural hedgers, are at their lowest net short position since 2008 at the same time that the managed money traders, the funds, are record short and at their lowest net long position since November 18, 2008,” said Gene Arensberg, editor of the Got Gold Report. “I have not seen the COT ‘rubber bands’ so over-stretched in opposite directions as they are now.”
US Bullion Coin Sales in February
U.S. Mint bullion sales on Monday were limited to American Silver Eagle coins. The 99.9% pure silver coins advanced 485,000 on the day to top 3 million for the month to date. In contrast, 1.49 million sold in February 2012.
Eric Sprott: Is the West Dishoarding Its Sovereign Treasure?
We are well into the financial crisis. Everyone’s trying to keep it together, even though it would appear from the reading of the economy things are not going well at all here. And everyone's ignoring things. But I think, in their hearts, the Central Bankers must know what they’re doing is totally irresponsible. And the tell of that irresponsibility – which is the debasing of the currencies – is the fact that real things will go up in value. This should be reflected in the price of gold and silver.
Russia, Turkey add gold holdings again in January -IMF NEW YORK
Russia and Turkey both raised their gold holdings for a second consecutive month in January, data from the International Monetary Fund showed on Friday, highlighting central banks' interest in diversifying part of their reserves into bullion.The IMF's monthly statistics report showed Russia added 12.2 tonnes to increase its gold reserves to 970 tonnes, solidifying the country's position as the ninth largest holder of gold in the official sector.Turkey raised its holding by 10.3 tonnes to 370 tonnes in January, propelling the country o 15th in the world gold-holding rankings, surpassing Venezuela.Ankara allows its commercial banks to use gold as collateral for loans, and changes to its balance sheet are often connected to such activity.In December, Russia added 19.9 tonnes to its gold reserves and Turkey added 45.6 tonnes.
Barclays: Swiss Trade Data Show No Palladium Shipments From Russia In January
Swiss trade data Thursday reveal that Russia did not ship any palladium to Switzerland in the first month of the year, says Barclays Capital. “January shipments have been as high as 572koz in 2006, but this year also contrasts with previous years where reduced shipments at year-end tended to be followed with a sharp increase in January, such as in 2008 and 2009,” Barclays says. “Shipments have picked up historically at the end of the year to meet quotas and although this is no longer an issue, the subdued shipments over the past year suggests a much tighter supply picture for palladium... We retain our conservative estimates for state stock releases from Russia at 200koz this year and our market balance forecast remains in a sizeable deficit at 681koz."
Gold’s Death Cross May Not Be So Bearish
Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research, points out gold prices have historically held up fairly well after the notoriously bearish formation takes place. Gold has averaged short-term gains up to six months following the 22 death crosses that have taken place since 1972, Detrick says. The 1.3% one-month average gain for gold following a death cross is better than the 0.9% average increase for the precious metal during any given one-month period. Throughout two-, three- and six-month time frames, gold gains following death crosses have slightly underperformed their typical returns. The biggest divergence has taken place over a six-month time horizon, when gold has averaged a 3.2% increase following death crosses, compared to a 5.7% average gain. What’s more, gold has historically had a more negative reaction to so-called “golden crosses.”
India bans gold jewellery from Thailand
In a fresh clampdown, India has officially banned the import of gold jewellery from Thailand. The government has announced that unless it is satisfied that gold jewellery imports from Thailand had received 20% value addition in that country, they would be banned. The authorities suspect that Indian importers are misusing the duty free pact with Thailand to import bullion from the South East Asian nation.
Traders rush to buy gold ahead of budget
Indian traders rushed to buy gold on worries the government may take more steps to curb soaring imports of the precious metal when it presents its budget later this month (Feb 28), while Chinese buying eased from levels seen earlier in the week."Most people in the market are concerned about policy changes in the budget," said a Mumbai-based dealer."Some sort of measures to curb gold imports can be there, that's why bullion players, especially jewellers, are increasing their stock levels."China, the world's second-largest gold consumer after India, has been actively buying since its markets reopened on Monday after a week-long Lunar New Year holiday during which gold dropped more than 3 percent. But buying interest has cooled since then even as gold has failed to rebound far from the six-month low."We still see physical demand coming in, but it's not very strong as the trend in gold is still bearish and people are more interested in other markets," said Peter Fung, head of dealing at Wing Fung Precious Metals in Hong Kong.
Market Nuggets: UBS Looks For Platinum To Slide Short Term But Lists 3-Month Target Of $1,850
850 "Given that our previous one-month PGM price targets were reached this month, they are now due for an update,” the firm says. “The PGM rally is starting to falter, although the underlying positive story remains intact. The combination of extended market length and potential downside risks to sentiment surrounding the U.S. automatic budget sequestration due in March could weigh on PGM prices in the short term. We therefore scale back our one-month platinum forecast to $1,650 from $1,720 previously. But we keep our one-month palladium target at $720, as this also indicates downside expectations given current price at $760. Three-month forecasts are maintained, at $1,850 for platinum and at $800 for palladium, on the back of expectations that investor interest should resume, and the correction is used as a buying opportunity.”
China's gold consumption up 9.35 pct in 2012
China's gold consumption amounted to 832.18 tonnes in 2012, an increase of 9.35 percent from a year earlier, data from China Gold Association showed Saturday. Consumption of gold jewelry rose 10.09 percent year on year to 502.75 tonnes, while those of gold bars and gold coins gained 12.22 percent and 21.63 percent, respectively, to 239.98 tonnes and 25.3 tonnes. But consumption for industrial and other uses saw a drop last year, the association said.
200 Million Ounces of Paper Silver Traded in 1 Minute Friday During Cartel Silver Raid!
Over a 5 minute period from 10:32-10:37 AM Friday, a massive volume spike (approximately 40,000 contracts) coincided with silver’s waterfall to $29.75- a fairly common occurrence during major cartel silver raids. Astonishingly however, 2 minutes after silver marked it’s low at $29.75, approximately the same volume traded over the next minute- spiking silver .15 off it’s low. It appears that a major buyer stepped in and took on the cartel at exactly 10:39 am on Friday 2/15 as nearly 40% of the day’s volume traded over a single minute.
German Automaker Reportedly Hoarding As Much Physical Silver As it Can Acquire
New signs of an extremely tight wholesale physical silver market have now emerged, as a first-hand account has revealed that one of the largest and most famous German automakers is hoarding massive amounts of physical silver inside one of the most secure vaults in Zurich, Switzerland.
Platinum Spikes Following Report Of People Shot Outside Amplats South African Mine
The tender (and doomed to fail) truce obtained several months ago between miners and platinum mining companies is formally over, following reports from Johanesburg that at least five workers have been shot outside of the the Rusetenberg mine by security officials during a standoff between rival unions.
How Long Can QE Continue?
Bullard discussed four considerations for QE3 going forward. First, while substantial labor market improvement is a condition for ending the program, Bullard said that "the Committee could consider many different aspects of labor market performance when evaluating whether there has been 'substantial improvement.'" These include the unemployment rate, employment, hours worked, and Job Openings and Labor Turnover Survey (JOLTS) data. Second, "Without an end date, the Committee may have to alter the pace of purchases as news arrives concerning U.S. macroeconomic performance," Bullard said, noting that "substantial labor market improvement" does not arrive suddenly.
China likely to launch gold ETF this year
China is likely to launch its first exchange traded funds backed by physical gold this year, boosting demand for the metal, according to the World Gold Council. "We do expect that you will see potentially more than one physical gold ETF in 2013," said Marcus Grubb, managing director for investment at the WGC, a lobby group backed by the mining industry.
Source: Financial Times
S.Africa's gold output falls 21.2 pct y/y in December
Refined gold is poured into moulds to be made into gold bars at South Africa's Rand Refinery in Germiston JOHANNESBURG (Reuters) - South Africa's gold output fell by 21.2 percent in volume terms in December, while total mineral production fell 7.5 percent compared with the same month last year, data showed on Thursday. Production of non-gold minerals was 5 percent lower, Statistics South Africa said. Production of platinum group metals plunged 23.2 percent in December.
Central banks last year bought most gold since 64
The world s central banks last year bought 534.6 tons of gold in 2012, the most since 1964, as global gold demand hit a record value level, the World Gold Council said Thursday in a quarterly report. Purchases by central banks for the full year rose 17% compared with 2011, while fourth-quarter purchases of 145 tons marked a 29% rise from the same period a year earlier. "Central banks move from net sellers of gold to net buyers that we have seen in recent years has continued apace," with official sector purchases across the world now at their highest level for almost half a century, said Marcus Grubb, managing director for investment at the World Gold Council. In value terms, total gold demand in 2012 was $236.4 billion, an all-time high, the council said.
India Remains Biggest Gold Buyer as Gap Between China Narrows
India remained last year’s biggest gold buyer, with the gap between second-largest consumer China narrowing to the smallest ever, the World Gold Council said.Indian usage jumped 41 percent in the fourth quarter, leaving the full-year total down 12 percent at 864.2 metric tons, the London-based industry group said today in a report. China’s consumption fell 0.5 percent to 776.1 tons, lagging India by 88.1 tons. The gap was 206.5 tons in 2011.The council said in November that China would probably overtake India as the biggest buyer on an annual basis. China’s economic growth slowed to a three-year low of 7.4 percent in the third quarter, before accelerating for the first time in two years in the three months through December. The two nations together account for about 52 percent of global consumer bullion demand, according to the council.
Zimbabwe gives producers two years to refine platinum locally
Zimbabwe's government told platinum producers on Tuesday to start refining the metal locally within two years, placing a further requirement on an industry already forced to surrender majority shares to locals. Producers would probably struggle to meet the new goal as refineries are very costly and can take several years to build, especially as Zimbabwe is suffering from a skills shortage. Mpofu also announced the government would reclaim some ground from mining companies, to be given to new investors in the sector. He said this move was meant to curb the holding of mining rights for speculative purposes and would start with the repossession of nearly 28,000 hectares of land from Implats' subsidiary Zimplats. "Following protracted discussions on the release of excess ground, my ministry is taking a step forward to repossess excess ground from Zimplats, measuring 27,948 hectares," Mpofu said.
G-7 Roils Currency Markets With Split on Concern Over Yen
Group of Seven policy makers roiled the currency markets they sought to calm amid conflicting messages on how much of an economic threat is posed by the weakening yen.The yen whipsawed as the G-7 appeared at first yesterday to signal joint acceptance of the Japanese currency’s recent drop, only to see its members offer contradictory interpretations of the group’s stance. One G-7 official said there’s concern about excessive moves in the yen, while the U.K. said the group wasn’t singling out an individual country or exchange rate. The yen initially fell, as the statement appeared to support Japan’s efforts to reinvigorate growth. But the currency later rebounded after a G7 official was quoted in Washington as saying the statement had been “misinterpreted” and was instead intended as a warning to Japan.The confusion will keep the spotlight on the threat of a so-called international currency war and Japan’s push for monetary stimulus when finance ministers from the Group of 20 gather this weekend in Moscow. Tensions may also constrain the type of stimulus that the Bank of Japan considers under its incoming leadership team, according to Barclays Plc.
U.S. gold bars and coins find new home overseas on Asian demand
Booming demand for gold as astore of wealth among Asian investors is driving physical goldbars and coins out of the United States and into Asia. A growing number of gold vaults for affluent Asians and newprecious metals investment products, particularlyexchange-traded funds, have led to an exodus of gold ownedprivately from the United States into emerging economic powerssuch as China. On Friday, Commerce Department data showed U.S. exports ofnonmonetary gold, which excludes central bank transactions,soared by 43 percent to $4 billion in December from the previousmonth. That's the highest total and the biggest month-on-month jumpin U.S. private gold exports since September 2011, when goldallied to a record high over $1,920 an ounce. Prices arecurrently about 14 percent below the peak at $1,643 per ounce.Hong Kong accounted for around $2 billion, or half of thenonmonetary gold exports for the month.
Gold smuggling soars in India
Gold smuggling incidents in the current fiscal year have zoomed over nine times as compared to the same period last year, with 250 tonnes coming in illegally. ``In 2011, India imported over 900 tonnes of gold and none of it came through smuggling. The hike in customs duty has not stopped the import of gold into the country. It has only changed the route as smugglers earn a profit of around $3,719 (Rs 200,000) on every kilogram of gold smuggled into the country,'' said Federation Chairman Bachhraj Bamalwa. Finance ministry data shows $175 million (Rs 9.4 billion) worth of gold was seized from more than 200 cases of smuggling during April to July 2012. This was a 272% rise from the level of the previous year. Moreover, between 2006-07 and 2010-11, gold seizure was almost nil, data from the directorate of revenue intelligence shows. They added that spot gold prices in India are 5.7% higher than in Dubai. Typically, gold is smuggled into India from neighbouring Dubai and Thailand. With every individual smuggling in an average of 5 kilo of gold per trip, the return on investment for each smuggler in one year amounts to almost 200%.
Impala Platinum: costs hit profits
Shares in Impala Platinum fell by as much as 3.4 per cent on Monday morning in Johannesburg following the release of a trading statement from the South African mining company detailing a fall in half-year profits. The statement, warning shareholders ahead of the company's half-year results on Thursday, says basic earnings per share for the six months ending December 31, 2012 are expected to be up to 79 per cent lower than the equivalent period in 2011, at 120-138 cents. In the statement, the company said the bulk of the expected decrease was caused by "a decrease in mine-to-market throughput [and] above inflation cost increases". A $68m writedown on payments owed to the company added to the losses. Implats, as Impala Platinum is known, is the world's second largest platinum miner, producing 1.45m ounces in the 2012 financial year, and was impacted heavily by industrial disputes across the South African mining sector over the past year. Another analyst, who also wished to remain anonymous, said: "Most people expected the results to be worse. But the key factor is that production is still weak. I think they may announce cuts on Thursday as a result of the cost increases and as a big, profitable producer that's a big message to government."
Putin Turns Black Gold to Bullion as Russia Outbuys World
When Vladimir Putin says the U.S. is endangering the global economy by abusing its dollar monopoly, he’s not just talking. He’s betting on it. Not only has Putin made Russia the world’s largest oil producer, he’s also made it the biggest gold buyer. His central bank has added 570 metric tons of the metal in the past decade, a quarter more than runner-up China, according to IMF data compiled by Bloomberg. The added gold is also almost triple the weight of the Statue of Liberty. For now, with more than five years left in Putin’s term, Russia plans to keep on buying. “The pace will be determined by the market,” First Deputy Chairman Alexei Ulyukayev said in an interview in Davos, Switzerland, on Jan. 25. “Whether to speed that up or slow it down is a market decision and I’m not going to discuss it.”
CME to cut margins on gold, precious metals, copper futures
CME Group Inc will broadly cut margins on precious metals including gold, silver and platinum as well as on copper, effective after close of business on Tuesday, Feb. 12.CME, the biggest operator of U.S. futures exchanges, said late Thursday it lowered initial margins on the benchmark COMEX 100-ounce gold futures contract by 10 percent to $5,940 per contract from $6,600.It also cut maintenance margins by 10 percent to $5,400 from $6,000.On Dec. 28, CME trimmed initial margins on gold futures by 11 percent.Futures exchanges often adjust margin requirements to protect themselves against the risk of participants defaulting in response to changing market volatility.CME also cut the margins on the COMEX 5,000-ounce silver contract by around 14 percent, and those of the NYMEX 50-ounce platinum futures contract by about 13 percent.In addition, CME lowered margins for COMEX 25,000-lb copper futures by around 11 percent.
China's 2012 gold output up 12 percent - paper
China's gold production rose for a sixth consecutive year and hit a record 403 tonnes in 2012, keeping its ranking as the world's largest bullion producer, the Shanghai Securities News said on Thursday. Hong Kong's net gold flow to mainland China jumped 47 percent in 2012 to a record high of 557.478 tonnes, indicating robust demand in China.
250 tonnes of gold smuggled into India in 2012: Jewellery body
In 2011, India had imported over 900 tonnes of gold and none of it came through smuggling, the representatives of the gems jewellery industry told a press conference. In 2012, the imports were 950 tonnes, out of which 250 tonnes came through smuggling. “The hike in customs duty did not stop gold imports into India, but only changed the route as smugglers earn a profit of around Rs 200,000 on every kilogram of gold smuggled into the country,” said GJF Chairman Bachhraj Bamalwa.
CME Cuts Gold, Silver Margins
CME once again cut margins in a slew of products, most notably gold and silver, by some 10% and 14%.
Platinum Extends Rally on Supply Concern Amid Cutifani Comments
Mark Cutifani, who’ll become chief executive officer of Anglo American Plc in April, said today there are “a number of issues” in the platinum industry, according to comments before a speech in Cape Town. “Platinum is at the forefront of precious metals investors’ minds because of supply issues in the world’s biggest producer,” said Gavin Wendt, a senior resource analyst and founder of Mine Life Pty in Sydney. “There’s sound reasoning for people to be putting their money into platinum.”
Swiss Palladium Imports From Russia Seen Lowest in 22 Years
Switzerland’s palladium imports from Russia, the biggest producer of the metal, dropped last year to the lowest level since 1990, according to Barclays Plc.Shipments fell by 72 percent to 154,600 ounces in 2012, the bank said today in an e-mailed statement. Switzerland imported 6,462 ounces from Russia in December, little changed from the previous month, the Swiss Federal Customs Adminiration said by e-mail today. The customs data showed only figures for last year.Sales from Russian inventories, a state secret, were 1,000 ounces in 2010, accounting for 14 percent of global supply, and probably totaled 250,000 ounces last year, London-based Johnson Matthey Plc estimated in November. The sales accounted for most of the remaining reserves, it said at the time. Palladium is mostly used in pollution-control devices in cars.
US Mint Sells 8.2 Million Silver Eagles Over First 17 Days of 2013 Production!
2013 Silver EagleAfter selling an all-time monthly record of 7.498 million Silver Eagles in January, the US Mint has picked up right where it left off in February once it began reporting sales figures again, announcing nearly 3/4 of a million silver eagles were sold Monday. The Mint has now sold a whopping 8,173,500 silver eagles during a mere 17 business days in operation during 2013, nearly 25% of the entire annual sales for 2012 of 33 million!
China Gold Imports From Hong Kong Gain to All-Time High in ‘12
Gold imports into mainland China from Hong Kong surged 94 percent to an all-time high last year as rising incomes in the world’s second-largest economy underpinned increased demand and helped the metal to post a 12th annual gain. Mainland China imported 834,502 kilograms (834.5 metric tons), including scrap and coins, compared with about 431,215 kilograms in 2011, according to Bloomberg calculations based on data from the Census and Statistics Department of the Hong Kong government. Imports in December rose to a monthly record of 114,405 kilograms, according to data from the department today.
Platinum Supply Falls to 13-Year Low as Mines Close: Commodities
Platinum supplies are falling to a 13-year low as mines in South Africa, the world’s biggest producer, close and automobile sales reach new highs.Production will drop 2.7 percent to 5.68 million ounces, the least since 2000, according to Barclays Plc, which raised its 2013 shortage estimate sixfold last month after Johannesburg-based Anglo American Platinum Ltd. (AMS) said it plans to idle shafts. At the same time, demand from carmakers, the biggest consumer of the metal, will increase 0.5 percent in 2013, Barclays says. Investors are buying platinum at the fastest pace in three years. “Supplies are very tight and it’s a serious situation,” said Mihir Worah, who manages $110 billion in real return strategy funds at Pacific Investment Management Co., in Newport Beach, California. “Not only are there issues on the supply side, we could see surprises on the demand side as well.”
CME Group: Open Interest in PGMs Hits Record High For Fifth Day In Row
Combined futures and options open interest in the platinum group metals has now hit a record high for the fifth day in a row, says CME Group. Open interest refers to the number of open positions at the end of the business day. As of Friday, platinum open interest stood at 101,023 for futures and options. The tally climbed steadily from a record that had stood at 96,967 as of Jan. 28. Meanwhile, open interest for palladium futures and options combined stood at 55,239 as of Friday. This had hit a record of 50,359 contracts as of Jan. 28 and then continued to climb for each day for the rest of last week.
The looming gold 'production cliff'
The gold supply-side story of the past decade is not encouraging. Big new deposits have been elusive. The number of "supergiant" discoveries has dwindled from two in the past five years to zero in the past two years. Comparing this to the impressive deposit discoveries of the 1970s and 1990s, one begins to get a sharper sense of the 'cliff'.Quality, too, is an issue. Ore grades have tumbled from an average of 12 grams per tonne in 1950 to roughly 3 grams in Australia, Canada and the US. In some cases, cutoff grades have dipped to 1 gram per tonne. "The next cutoff," claimed Lassonde, "is dirt."Add skyrocketing production costs to the mix, and the picture becomes even more grim.Lassonde's call to arms includes a concerted, industry-wide boost in research and development. "Where is the new technology?," he asked.Gold miners can buck the trend, according to Lassonde, by taking a page out of the petroleum industry's playbook: by pooling investment for scientific studies and by more aggressively securing access to land.
Jumping exports give silver impetus in India
To gold starved Indian consumers, silver has taken on a brighter hue at home, but it remains the silver export sector that is leading the charge.With the Indian government cracking down on gold, the metal's poor cousin, silver, has shot into the limelight. Silver jewellery exports are expected to lead this fiscal year, given the geographical expansion into the markets of CIS (Commonwealth Independent States) and eastern Europe, both of which have benefited silver jewellery. With the US and European market favouring white metal jewellery over gold items, silver jewellery pieces made in India are a big hit with the Westerners.As an official of the council pointed out, India's silver jewellery exports for FY12 stood at $691 million (Rs 36 billion) against $482 million (Rs 25 billion) in FY11."During 2011-12, silver jewellery exports grew 44% compared to gold jewellery exports growth of 30%. We will have to wait and see what the next two months bring in for silver retailers,'' the official said.Manubhai Shroff of the Bombay Bullion Association added, ``The Indian government is presently cracking down on the people's ability to buy gold through regulations and taxes. Given the insatiable appetite for the precious metal, people will naturally gravitate towards gold after buying silver items for some time.''
Platinum may be up for strategic State ownership
Platinum stands a good chance of being identified by South Africa's leading political party as a strategic national asset, which might require State ownership to increase development potential, says Pan-African advisory firm africapractice senior consultant Vukani Mde. Following a recommendation outlined in the African National Congress's (ANC's) 'State Intervention in the Minerals Sector' (Sims) report, the ruling party adopted the term 'strategic State ownership' at its five-yearly elective conference in Mangaung last year, as it rejected the idea of outright nationalisation. "The ANC dropped any reference to nationalisation in all its policy documentation to further emphasise that there would be no mandatory, ideology-driven State control of the sector," Mde says. He explains, however, that the State will be directed to intervene when social and industrial development goals need to be pursued.
US Mint Gold and Silver Bullion Coin Sales Surge in January
2013 Gold EagleThe United States Mint's gold and silver bullion coins have started the year in impressive fashion. The American Silver Eagle recorded the highest monthly sales figure in the history of the program. The American Gold Eagle reached the highest monthly sales in more than two years. American Silver Eagle bullion coins reached total sales of 7,498,000 during the month of January 2013. This exceeds the previous monthly sales record of 6,422,000 achieved in January 2011. The new monthly sales record is made even more impressive by the fact that the coins were not available for more than half the month. Authorized purchasers were able to place orders from the launch of the 2013-dated coins on January 7 until the temporary sell out announced on January 17. Sales were finally resumed on January 28 and have continued on a rationed basis.
Global Silver-Mining Trends
Over the course of silver's secular bull, the miners have steadily increased production in order to meet fast-growing demand. And in 2012 mine production exceeded 24k metric tons (770m+ ounces), an all-time production high and 28% increase over 2001. As an investor interested in silver's structural fundamentals, this rapid growth begs a question. Where in the world is this silver coming from? One major takeaway we can gather from this information is that total output and/or growth rates don't necessarily translate to opportunity for the miners. Some of these countries are host to geopolitical situations that all but block foreign investment. And some are producing silver solely as a byproduct, ultimately lacking geologically favorable primary silver deposits. These situations are not conducive to mining companies looking to directly leverage silver.
Platinum Market Seen Producing Deficit of up to 760,000 Ounces in 2013 -CEO
The global platinum industry is forecast to produce a deficit of anywhere between 80,000 troy ounces to 760,000 ounces, said the Chief Executive of South Africa's Royal Bafokeng Platinum Ltd. I (RBP.JO), a joint venture partner with Anglo American Platinum Ltd. (AGGPY, AMS.JO).Steve Phiri told an audience at the GMP Securities Mining Jamboree in South Africa, which accounts for some 80% of the world's platinum output, cash costs have been rising 18.1% year on year since 2007 with labor and energy being blamed as the culprits. At the same time strike action and safety stoppages coupled with the low price of platinum in rand terms have forced platinum producers to shutdown loss-making operations.
China's scramble goes platinum
As older and less profitable shafts face closure, Chinese money is bank rolling one of a handful of new platinum mines being built in South Africa, which sits on about 80 percent of known global resources of the white metal. Wesizwe Platinum's Bakubung mine, which aims to start production in 2018 and churn out 350,000 ounces of platinum group metals a year by 2023, is China's first direct investment in the sector and it likely won't be the last. A Chinese consortium headed by mining giant Jinchuan has a 45 percent stake in Wesizwe and the China Development Bank (CDB) last week provided a $650 million loan, providing the project with the capital needed to complete the mine.
SA platinum, gold mining electricity costs up $780m since 2007
You have pushed it as far as it can go. We have now reached a tipping point. This was the clear message from business and mining today at the last day of the public hearings on Eskom’s applications for a 16% annual increase in average electricity tariffs over the next 5 years. ...already 50% of the local platinum industry is marginal or in a loss-making position. In the gold mining industry this percentage is 37%. These industries have seen electricity price increases of 258% and 143% respectively over the last four years, adding about R7bn in costs onto their costs profile.
Palladium hits high on supply crunch bets
Palladium prices rose to a 16-month high above $750 a troy ounce on Wednesday as bullish hedge funds drive the precious metal higher.Palladium, which is mainly used in catalytic converters that scrub car exhausts, is a niche metal little-known outside the precious metals industry.But it has become a darling of hedge funds this year, as they anticipate that a sharp decline in supplies could drive prices higher. Since November, palladium prices on the spot market have risen 26 per cent. The metal on Wednesday rose 1.3 per cent to a high of $757.22 - a level last seen in September 2011. "Palladium is one of our favourite picks among the metals over the long term," Tiberius Asset Management, a Swiss commodities fund manager, said in a monthly commentary this week, saying that the metal was one of "only a handful of industrial commodities" facing a sustained market deficit, along with platinum, tin and lead.
Source: Financial Times
Gold or Platinum—Which Will Get to $2,000 First?
Gold and platinum have been locked in a tight race for the past month, with both trading currently around $1,680 an ounce, prompting the question – which precious metal will win the race to $2,000? Analysts told CNBC that platinum, which is used as an industrial raw material and in making jewelry, has the edge over safe-haven gold.
Bernanke Dissatisfied With Growth Will Press on With Pace of QE
Federal Reserve Chairman Ben S. Bernanke signaled he isn’t close to easing up on $85 billion in monthly bond purchases to spur a stalled economy and bring down 7.8 percent unemployment. The Federal Open Market Committee said in a statement yesterday that growth, while slowed by “transitory factors,” faces “downside risks” even after strains in global financial markets have eased. The expansion will pick up and unemployment will fall in response to “appropriate policy accommodation,” Fed officials said in a statement after a two-day meeting.
U.S. gold, silver production down in 2012—USGS
U.S. mines produced 230 metric tons of gold in 2012, down from 234 metric tons in 2011. In 2012, the United States mined 1,050 tons of silver with an estimated value of $1.01 billion, down from 1,120 tons in 2011.
New era of openness on Bundesbank gold
In that context, it is not the Bundesbank’s decision to move its gold but its decision to be more open about where it is located and how it has traded it in the past, that is most welcome. In one document published on its website this month, the Bundesbank lists, for example, each one of its gold transactions since 1951. In another, it details how much gold it has held in each of New York, London, Ottawa, Paris, Bern, Frankfurt and Basel since 1951, and how much it was lending to the market at any one time. This reveals the interesting titbit that the Bundesbank moved almost 1,000 tonnes from London in 2000 and 2001. It also shows that the German central bank halted all gold lending activity in 2008 when the financial crisis began – presumably because of concerns about the credit risk of the banks it was lending to.
Source: Financial Times
U.S. Mint Silver-Coin Sales Gain to All-Time High in January
Sales surged to 7.42 million ounces so far in January, the biggest monthly total since 1986, when the Washington-based Mint began the transactions, Michael White, a spokesman, said in a phone interview yesterday. The figure compares with the 1.635 million ounces sold in December, according to mint data. The Mint resumed silver-coin sales Jan. 28 after suspending them for more than a week because of a lack of inventory. Sales of American Eagle gold coins have risen 84 percent to 140,000 ounces so far this month compared with December, Mint data show. That would be the highest monthly total since July 2010.
Norilsk sees palladium output flat in 2013
Top global producer Norilsk Nickel is expecting little change in its palladium output in 2013, as robust demand and lower supply indicate a deficit this year, a senior Norilsk executive said. "In 2013, palladium use in industrial applications will continue to significantly exceed the annual volume of mined and recycled palladium," Anton Berlin, head of marketing at Norilsk's sales subsidiary Normetimpex, said. Norilsk produced around 2 million troy ounces of palladium in the first nine months of 2012, according to the latest available production data. For the full year 2012, Norilsk's output will account for 42% of the world's mined palladium supply. Additionally, the Russian stockpile has been a key source of supply to the palladium market in recent years, but sales from this stock will likely fall below 100,000 oz in 2013, Mr. Berlin said. No stockpile sales are expected after 2014, he added. "Discontinuation of Russian deliveries will shift the market to a state of substantial statistical deficit. The tightness in the markets would...become intense over time, eventually resulting in further price appreciation," Mr. Berlin said.
Swiss banks lose old taste for gold
The wealthy have for centuries turned to Switzerland as a safe and convenient place to stash their gold. But Swiss banks are now demanding higher fees to accept the world’s bullion, as they seek to reduce the size of their balance sheets. UBS and Credit Suisse, which dominate the powerful Zurich-based physical gold market, have hiked their charges for holding the metal, according to clients and people familiar with the banks. The move is an attempt to persuade their biggest clients – including other banks, hedge funds and institutional investors – to take direct ownership of their gold in so-called “allocated” accounts, with the bank simply acting as a custodian. Under more common “unallocated” gold accounts, depositors’ gold appears on banks’ balance sheets, forcing them to increase their capital reserves.
Source: Financial Times
Mark Carney Leaves Canada With 'Stealth QE' Rising At Fastest Pace Since 2009
It seems quietly and with little aplomb, Carney's BoC has grown its balance sheet by over 21% YoY - the most since 2009. If that was not enough to make someone nervous, the quantity of Canadian government bonds on the BoC's balance sheet has grown at a remarkable 46% YoY! All of this has taken place during a time when 'supposedly' the Canadian economy has been reasonably strong and foreign demand for debt high. With Canada's CAD267bn debt due in 2013, we suspect this 'stealth' QE will continue to rise.
India Imported 33% More Gold in January to Beat Tax, Group Says
Overseas purchases may total 75 metric tons to 80 tons this month compared with 60 tons a year earlier, with bulk of the imports being made in the first three weeks, Bachhraj Bamalwa, chairman of the All India Gems & Jewellery Trade Federation, said by phone. Domestic demand, which has weakened in the past week, may improve in February because of marriages, he said. “People imported more gold in the first week of January in anticipation of the tax,” Bamalwa said. “Imports weakened after the tax was announced and demand is yet to pick up.”
Palladium Strongest Since Sept. 2011 As Supply News, Stronger Euro Lift PGMs
Platinum group metals are bucking the trend in the overall metals complex by trading higher when gold, silver and most of the base metals are lower. Support is coming from currency factors, supply issues and technical considerations. Afshin Nabavi, head of trading with MKS (Switzerland) SA, cites fresh news reports suggesting Russian stockpiles of palladium are nearly depleted. Technically, palladium has been holding support lately, and spot metal went on to $739.30 high that was its most muscular level since September 2011, he adds. “The PGMs overall look positive on the back of supply worries,” he adds.
Russia, Kazakhstan Expand Gold Reserves as Central Banks Buy
Russian holdings climbed 2.1 percent to 957.8 metric tons in December, taking the increase over 2012 to 8.5 percent, according to data on the International Monetary Fund’s website. Kazakhstan’s hoard expanded 1.7 percent to 115.3 tons last month, and surged 41 percent over the year, the data showed. Turkey’s holdings jumped 14.5 percent to 359.65 tons last month.
Analysts Bullish on Palladium
Having gained 7.5 percent in 2012, palladium outperformed gold, which only gained 7.1 percent. In the fourth quarter, the white metal’s performance was even more impressive. With gains of 10 percent, palladium was the top performer of the precious metals complex. Many analysts predict that palladium will earn the title of top performer in 2013.
Beijing to impose tough car emission standards
Beijing officials are set to introduce harsher emission standards for vehicles from next month.The move comes as air pollution in the city registered as 755 on a scale designed by the US Environmental Protection Agency to measure from 0-500.The official Xinhua News Agency reported that the new Beijing V emission standard will be adopted from February 1st.The emissions rules, which are similar to those already in effect in Europe, will apply to all new vehicle registrations, not those already in use.Diesel cars that fail to meet the standard will have sales and plate registrations halted from next month, while the sale of substandard gasoline cars will be banned from March 1st.
What's Going On At The iShares Silver Trust?
As detailed here last week, the popular iShares Silver Trust (SLV) added a whopping 571 tonnes to its holdings on January 16th, causing a good deal of speculation as to who or what was behind the change. This added more than a half a billion dollars worth of silver to the trust and, given its history of big inflows and outflows, it should come as little surprise that, yesterday, per the latest data at the iShares website, nearly 200 tonnes exited the trust as shown below. Following a smaller outflow of 45 tonnes two days ago, this leaves the holdings up over 300 tonnes in the last week.So, what's going on? No one really knows, however, yesterday's outflow casts doubt on the theory that last week's big inflow was due to buying by a large institutional fund. Another theory for last week's big inflow was that a large short position, perhaps held by JP Morgan, was recently closed out. According to ShortSqueeze, the short position for SLV has recently fallen from over 18 million shares to about 17 million.
Federal Reserve Statistical Release
The Fed balance sheet has topped $3 trillion for the first time due to $35.566B of MBS monetization and$7.805B of Treasury monetization. Fed balance sheet growth ($47.921B y/y) has jumped to 3.13% y/y. The MBS monetization that had occurred weeks ago finally settled.
UPDATE 3-Russia c.bank to keep buying gold - Ulyukayev
The Russian central bank will continue to buy gold as it seeks to diversify its foreign reserves away from paper assets it views as risky, First Deputy Chairman Alexei Ulyukayev said on Thursday.The Bank of Russia has built up the world's fourth-largest foreign reserves, worth $530 billion, by buying oil export dollars to keep the rouble competitive. The hoard includes two rainy-day budget funds that guard against fiscal shocks.The bank has also been a bullion buyer and the share of gold in its reserves is approaching a medium-term target of 10 percent, raising questions over whether it would keep buying gold.
Forget Germany, Check Out Turkey's Central-Bank Gold
The tactics differ too. Because the central bank hasn't bought and paid for this gold. Private citizens have."Gold-based deposit accounts [in Turkey] surged 15% this year through the end of July," explained BusinessWeek back in October, "three times the increase in standard savings accounts.""Although much criticised for its use of 'unconventional measures'," the Financial Times added in December, "few would argue that the decision last year by Turkey's central bank to allow the country's banks to buy gold was anything less than a roaring success."Buying gold isn't quite right. Starting in October 2011, the central bank began allowing commercial banks to hold a portion of their "required reserves" - needed to reassure depositors and other creditors they had plenty of money to hand - in physical gold bullion. Starting at 10%, that proportion was then raised to 30%. Private citizens were similarly encouraged to hold their gold on deposit with their banks. That gold was thus transferred to the central bank's balancesheet. Et voila! Privately-owned gold now backed the nation's finances. A smart idea, which has coincided with Turkey's currency rising, interest rates falling, huge current-account shrinking, and government bonds regaining "investment grade" status.
Now Royal Canadian Mint rationing silver coin sales
Silver demand looks to be running at particularly high levels in January as the Royal Canadian Mint follows US example and begins rationing sales of its Silver Maple Leaf coins.
What does HSBC know about silver?
Holdings of iShares Silver Trust, the world's largest silver ETF, stood at 10,689 tonnes on Jan. 22, up 604.9 tonnes, or nearly 6%, from the end of 2012. By comparison, SPDR Gold Trust, the world's top gold ETF, saw an outflow of nearly 15 tonnes so far this year. The bank has secured another deal to buy silver bars from KGHM, which brings their total purchases of silver from KGHM alone in the last 12 months to $876 million or PLN 3.65 billion. KGHM is one of the largest producers of silver in the world and is the second-largest producer of refined silver in the world. Listed metals producer KGHM signed an estimated PLN 1.67 billion deal on 2013 sales of silver to HSBC, KGHM said in a market filing yesterday.The deal puts the total value of deals between KGHM and HSBC in the last 12 months to PLN 3.65 billion or $876 million, the filing read.
Almost nothing about the big deposit is negative to the price of silver, including the question of where the heck did someone come up with 19 million oz of silver? That's because, even if someone did come up with that much silver, then there is now 19 million less ounces than can be further come up with from this point. Who ever bought the silver wasn't buying due to the price-momentum approach of chasing higher prices; the buyers bought nearly $20 below the peaks of 2011. That suggests a long term approach with not much concern for lower prices in the short term; in other words, a strong holder. The truth is that the big deposit into SLV was strange and it may take some time to figure out. Like most things in silver, it will probably come to make sense in due course. Still, it was a head-scratcher for me.
Source: Ted Butler
Government hikes import duty on gold; ETFs to park some holdings with banks
NEW DELHI/KOLKATA: The government on Monday announced a slew of measures including a hike in import duty on gold and platinum to discourage their consumption. The finance ministry directed gold exchange-traded funds to park a part of their gold holdings with banks so that some demand for these metals is met from domestic sources.It also eased the terms of gold deposit schemes of banks to encourage individuals to deposit their idle gold, which will help increase domestic supply.India's current account deficit widened to a record 5.4% of gross domestic product in the first half of the current fiscal as gold and crude oil imports remained high, increasing the country's dependence on foreign capital inflows. Announcing the measures, economic affairs secretary Arvind Mayaram said import duty on gold and platinum will now be 6% against 4% earlier. He said the steps taken by the government will help moderate the quantity of gold that is imported.
First-Hand Account of Gold & Silver Mania in China- Black Friday Style Mobs Scrambling for Bullion
With the Chinese New Year less than a month away, Ichban describes Chinese demand for gold and silver in Beijing as a tidal wave, and states that the demand for gold and silver is more intense than Thanksgiving/ Black Friday mobs in the US, despite the nearly 60% premiums retail dealers are asking for silver bullion!! Ichban gives readers a glimpse of what to expect when the mania stage of the gold and silver bull markets finally reaches the US, as he describes the scene at Chinese retail bullion stores: Despite these high premiums, I have never seen such frenzied buying in my life! I am a young adult male and 40 year old Chinese women are shoving me out of the way because they are trying to buy some gold and silver!
Repatriation Avalanche Gaining Momentum: Azerbaijan to Withdraw All Gold From JP Morgan Vaults
The State Oil Fund of Azerbaijan has withdrawn the first ton of its physical gold from JP Morgan vaults, and placed it in their own Central Bank vaults in Baku. The Fund has announced it will withdraw all of its physical gold assets from JP Morgan warehouses in London. The Oil Fund has been acquiring physical gold since February 2012 in batches of 10,000 ounces a week. By early 2013 SOFAZ brought its gold assets up to 14,934 kg (480,146 ounces). Initially London-based warehousing units of JP Morgan were selected for storage, but now all the gold will be gradually transferred to storage in Azerbaijan. Prior to the completion of construction of a new residence of SOFAZ this gold will be stored in the CBA vaults, and then will be transferred to the Fund's own store in its residence at Heydar Aliyev Avenue in Baku.
Is Ted Butler's Silver Panic Imminent? Apple Contractor Claims New iMac Production Delayed Over Silver Shortage!
Ted Butler has long predicted and awaited an eventual industrial shortage of physical silver, and a resulting panic silver buying that terminates the bullion bank cartel's manipulation of the silver market. Butler may be about to be finally proven correct, if an Apple contractor is right that Apple has delayed production on the new 27" iMacs over an industrial silver shortage in China.With the US Mint sold out of Silver Eagles and production shut down for the 2nd time in 2 weeks, and shortages of nearly all retail silver products rapidly developing along with spiking physical premiums, it appears that a widespread retail, and perhaps industrial physical silver shortage is developing and escalating by the hour.
Germany Reaffirms the Timeless Relevance of Gold
Those investors who continue to miss out on one of the world's most powerful bull markets have officially just lost one of their most commonly cited rationales for doing so. With the watershed announcement this week that Germany's Bundesbank will repatriate nearly one-fifth of the nation's gold reserves, any last claims to the failed notion that gold somehow lacks relevance in the modern day financial system have just been obliterated.Germany's central bank will take delivery of 674 metric tons of its gold currently held in Paris and New York over the next seven years, with the stated objective of holding 50% of the nation's 3,400-ton hoard at home (compared to the 31% of its gold reserves already reported held in German vaults).
A new Gold Standard is being born
The world is moving step by step towards a de facto Gold Standard, without any meetings of G20 leaders to announce the idea or bless the project. Some readers will already have seen the GFMS Gold Survey for 2012 which reported that central banks around the world bought more bullion last year in terms of tonnage than at any time in almost half a century. They added a net 536 tonnes in 2012 as they diversified fresh reserves away from the four fiat suspects: dollar, euro, sterling, and yen.
Mint runs out of 2013 silver coins, suspends sales
Mint has suspended sales of its 2013 American Eagle silver bullion coins after running out of stock due to soaring investor demand for the newly minted coins in the first two weeks of the year. Sales to authorized dealers will resume on or about the week of January 28 after the U.S. Mint has replenished its inventory, it said in an email to authorized dealers on Thursday. Silver Eagle sales to January 15 exceeded 5 million ounces and were on track to surpass the all-time monthly high of 6.1 million ounces, set in January 2012.
SLV Adds Record 572 Tons Of Silver In One Day, More Than In All Of 2012
It is the biggest one day addition of physical silver to SLV in ordinary course operations. It is also more silver added to the ETF in all of 2012, when just 544 tons were added in the entire year. This was driven by the creation of some 19,000,000 shares of SLV overnight which brought the total to 356.8 million shares. And since there has been no move in the price of silver, which certainly would have soared had this amount been purchased in the open market we can only assume this has to do with in kind basket creation taking place.
It Will Take The Fed Seven Years To Deliver 300 Tons Of German Gold
The biggest news of the day comes from the official Buba announcement that, in its official capacity as a prudent central bank, it - as first of many - is looking to repatriate some 300 tons of gold from the New York Fed. That, however, is not today's news - that was Monday's news. What is news is that courtesy of the supplied calendar of events in the Buba statement, it will take the Fed some seven years to procure Germany's 300 tons of gold. This is the same Fed that, in its own words, holds some "216 million troy ounces of gold" or some 6720 tons, in its vault 80 feet below ground level.Why it will take the Fed 7 years to part with an amount of gold that is less than 5% of its total holdings is anyone's guess...
Fitch Unveils Two Possible Routes to Downgrading U.S. Debt Rating
Fitch said Tuesday that it may downgrade the nation's debt even if lawmakers raise the debt ceiling, if Washington emerges from those negotiations without taking steps to lighten the U.S. debt load. Another "self-inflicted crisis," said David Riley, head of Fitch's sovereign-rating team, "will put into question the predictability and reliability of our policy making when it comes to fiscal policy," increasing the likelihood of a downgrade. Also inconsistent with a triple-A rating, Mr. Riley said, is if lawmakers staring down the debt ceiling limit choose to make debt payments while skipping out—even temporarily—on Social Security payments or other government obligations.
World on Brink of ‘Currency War’ After Japan Move: Russia
The world’s leading economies are on the brink of a “currency war” to keep up with Japan and use devaluation to boost their competitiveness, Russia’s central bank said. “Japan is weakening the yen and other countries may follow,” Bank Rossii First Deputy Chairman Alexei Ulyukayev said at a conference in Moscow today.
U.S. gold and silver coin sales soar, but dealers cautious
American Eagle gold and silver coin sales have been exceptionally strong in January, building on a late 2012 rally as collectors scramble to snap up newly minted 2013 coins and investors seek refuge from U.S. economic uncertainty. Some coin dealers, however, warn of a post-January drop in sales similar to last year's pattern, as early interest tends to wane once the first mintage is over. As of Jan. 15, silver Eagle sales for the month exceeded 5 million ounces, data from the U.S. Mint's website showed. At that rate, sales would surpass an all-time monthly high of 6.1 million ounces set in January 2012. ... the premium of a physical U.S. American Gold Eagle coin has been quoted at 5 percent over spot gold, which is around $85 based on Tuesday's price, dealers said.
US Mint Sells 4.8 Million Silver Eagles in 1 Week!
The US Mint reported another 300,000 oz of 2013 Silver Eagles sold Friday, bringing the 1 week sales total to what is believed to be a record 4.782 million ounces!With nearly 3 full weeks remaining in jan 2013, the US Mint sales totals are set to shatter January 2011′s all-time monthly record of 6.422 million ounces.
BUNDESBANK TO REPATRIATE 374 TONS OF GOLD FROM BANK OF FRANCE, SUBSTANTIAL PORTION OF GOLD HELD AT THE NY FED!
In the months that followed Hugo Chavez’ 110 ton gold repatriation request in the summer of 2011, gold exploded nearly $400 as the bullion banks panicked.
It Begins: Bundesbank To Commence Repatriating Gold From New York Fed
In what could be a watershed moment for the price, provenance, and future of physical gold, not to mention the "stability" of the entire monetary regime based on rock solid, undisputed "faith and credit" in paper money, German Handelsblatt reports in an exclusive that the long suffering German gold, all official 3,396 tons of it, is about to be moved. Specifically, it is about to be partially moved out of the New York Fed, where the majority, or 45% of it is currently stored, as well as the entirety of the 11% of German gold held with the Banque de France, and repatriated back home to Buba in Frankfurt, where just 31% of it is held as of this moment. And while it is one thing for a "crazy, lunatic" dictator such as Hugo Chavez to pull his gold out of the Bank of England, it is something entirely different, and far less dismissible, when the bank with the second most official gold reserves in the world proceeds to formally pull some of its gold from the bank with the most.
GOLD & SILVER COT REPORT: COMMERCIALS COVER MASSIVE 20 MILLION OUNCES OF SILVER SHORTS!
Gold & Silver COT Report: Commercials Cover Massive 20 Million Ounces of Commercial longs trimmed back 438 contracts on the week and covered a huge 4,509 shorts to end the week with 47.70% of all open interest, a decrease of 0.42% in their share since last week, and now stand as a group at 206,325,000 ounces net short, which is a significant decrease of 20,355,000 net short ounces from the previous week. Considering the commercials reduced their net short position by 20 million ounces and yet price was virtually unchanged, we have to believe the time is ripe for a dramatic price increase to their short term advantage and it appears they have merely been repositioning contracts for this purpose.
Real Silver Highs 4
Silver bearishness has naturally mushroomed following this metal’s rough December. A growing chorus is declaring silver’s secular bull finished, implying it must have peaked after silver’s dazzling April 2011 surge. But secular bulls climax in popular speculative manias, which dwarf the silver action of a couple springs ago. Looking at silver in real inflation-adjusted terms drives home the point its bull is far from over. But there is definitely a mean-reversion tendency in silver’s returns. Weak years are generally followed by strong years, and vice versa. After 2008’s stock panic crushed it, silver soared 52% in 2009 and 83% in 2010. And those incredible years led into the high consolidation of 2011 and 2012, with their 10% loss and 10% gain. So if silver’s secular bull is indeed alive and well, it is certainly due to surge once again in 2013.
Indian gold imports surge amid fears of further duty hikes
Jewellers say they will shut up shops in protest if the government further raises import duties on the precious metal and warn that smuggling will likely grow as a result. While jewellers across India are planning to launch an agitation against the Indian government's proposal to increase import duty on gold to around 6% from the current 4%, a massive jump in gold imports has been witnessed across the country. "As compared to the normal 5-6 metric tonnes each week, traders have imported more than 30 metric tonnes already in the last five days,'' he added. "The monster (smuggling) will only grow with more talk of import hikes. These were effectively dealt with in the past, and today the jewellery industry is organised. A new hike will deal a body blow to the sector, which has been posting good returns,'' Sadhaye added.
China's CIC says U.S. Treasuries safe for now, but prices high
(Reuters) - U.S. government bonds are a safe investment, but a rise in bond prices has created uncertainties, the chairman of China's sovereign wealth fund said on Monday. Lou Jiwei, chairman of the China Investment Corp. (CIC) made the comment at the Asia Financial Forum in Hong Kong, adding CIC's strategy will be "to invest in some U.S. Treasury bonds and add more of other assets" to reduce the uncertainty in the fund's portfolio caused by the bonds.
KC Fed's George: Prolonged Zero Rate Boosts Financl Imbal Risk
Kansas City Federal Reserve Bank President Esther George warned Thursday that the Fed's unconventional monetary stimulus efforts could not only boost inflation expectations, but also lead to higher unemployment by creating financial imbalances that destabilize the economy. George, a voting member of the Fed's policymaking Federal Open Market Committee this year, said the zero short-term interest rate policy and the use of bond buying to push down long-term interest rates are altering the behavior of investors and financial institutions in risky ways… What's more, the Fed's $85 billion a month program of Treasury bond and mortgage-backed security purchases threatens to "complicate" the Fed's eventual "exit" from monetary accommodation, George said in remarks prepared for delivery to the Central Exchange…
High gold prices push India's farmers toward silver
Silver artifacts and jewellery have made their way into farmers' hearts and homes across India as a cheaper alternative to the more expensive gold for investment purposes. Ahuja said most of the farming community across Haryana and Punjab in North India, were buying silver as a cheaper alternative to the more expensive gold for investment purpose. "The trend began at the end of 2010 when silver prices started rallying to a 30 year high. The price of silver has great potential to go even higher this year. Plus, most shops have been showcasing exquisite silver jewellery items. The lure is too much," he added. This year, the traditional green and gold bangles jingling to the rhythm of dance, traditional gold-lined ghagras (skirts) and suits, will now gyrate with a new partner, silver kadas (thick bangles) and heavy necklaces marking the celebration of the harvest festival across India.
Highest Ever One-Day Sales for American Silver Eagles?
Today, January 7, 2013, the United States Mint began accepting orders from authorized purchasers for 2013-dated American Silver Eagle bullion coins. The opening day sales tally of 3,937,000 coins seems to represent the highest one-day sales total in the history of the program.In recent years it has been typical for the Mint to experience the strongest sales for Silver Eagle bullion coins on the first day of availability for newly dated coins. Last year, orders had been placed for 3,197,000 Silver Eagles on the first day of availability for the 2012-dated coins. In 2011, opening day sales had measured 2,085,000 coins, and in 2010 opening day sales had measured 2,440,000 coins. For the years 2009 and prior back to the start of the program in 1986, none of the monthly sales totals have exceeded today’s one-day sales total of 3,937,000 coins.
What happens to the gold price if the 3 biggest pension funds in Japan allocate just 5% of their total assets into gold?
The top 3 Japanese pension funds are: So the Government Pension Investment ($1,432,122), Local Government Officials ($189,633) and the Pension Fund Association ($124,987) have a combined $1.75tn in assets or more than half the entire $3.36tn pension fund market of Japan. So of those three pension funds how much if any do they invest in gold? At today’s price of around $1,660 per ounce $17.5bn will get you around about 10.5 million ounces.$87.5bn will get you around 53 million ounces.There are 32,150.7 troy ounces in a metric tonne. Which means that in metric tonne terms we’re looking at 327 tons for a 1% allocation and 2,721 metric tonnes for a 5% allocation.
Fourth-quarter inflows into gold ETPs exceed other commodities: ETF Securities
The value of physical inflows into gold exchange-traded product funds in the fourth quarter once again exceeded quarterly inflows of other commodity ETPs, according to data that fund provider ETF Securities released Monday. Gold ETPs saw Q4 net inflows of $4.5 billion, far outdistancing the $445 million in crude oil ETPs and $410 million for broadly diversified commodity ETPs, said ETF Securities analyst Nicholas Brooks. Overall, energy ETPs saw Q4 inflows totaling $682 million, compared with net Q3 outflows of $627 million, while precious metal ETPs saw Q4 inflows totaling $4.95 billion compared with $8.3 billion in the previous quarter. "Most of the gold ETP investors are buying gold because they are concerned about the US debt problem, and the potential for further debasement of the US dollar," he said. "And in Europe, investors are also concerned about the same thing, with the added concern about the sovereign debt crisis and some kind of break-up of the euro."
Hong Kong-China Nov gold flow hits second-highest in 2012
* Hong Kong Nov gold exports jump 91 pct on month to 90.763 tonnes
* Hong Kong imports 27.681 T gold in Nov, up 23 pct on year
* Robust physical gold buying from China continues (Adds details, comments)
SINGAPORE, Jan 8 (Reuters) - The net gold flow from Hong Kong to mainland China in November hit its second-highest level in 2012 after April, adding to evidence of China's unabated gold appetite, which lent support to gold prices.Hong Kong exported 90.763 tonnes of gold to mainland China in November, an increase of 91 percent on the month. Its gold imports from China rose 23 percent to 27.681 tonnes, the Hong Kong Census and Statistics Department said on Tuesday.The total net gold flow in the first eleven months of the year, at 462.75 tonnes, already exceeded last year's total of 379.573 tonnes, Reuters calculations showed.
Gold price back to evens for the week as Japanese pension funds look to double gold holdings – Gold at all time highs in Yen
The new Japanese prime minister Abe announced overnight that the Japanese government would be lending money to the ESM, Europe’s own bailout fund – this comes on the back of Abe’s announcement that he will ‘require’ the Bank of Japan to hit a 2% inflation target – see this for what that means for Japan and the rest of the world. So it is absolutely no surprise that Bloomberg reports that Japanese pension funds are turning to gold: Japanese pension funds, the world’s second-largest pool of retirement assets after the U.S., will more than double their gold holdings in the next two years as the new government pushes for a higher inflation target, according to an adviser to the funds.
Billionaire Eric Sprott - Fed Has No Exit Plan & There Is No Exit
The Fed is trying to suck and blow at the same time because they are suggesting the rates are going to stay low out to 2015, unless the unemployment rate gets down. They come out with this statement about the minutes, which means nothing because it’s not policy... What is the exit plan for the Fed? Well, as you know there is no exit plan. There never was an exit plan, and there is no exit. And it just gets worse all the time. There’s not a hope in hell that the Fed will not continue to buy the bonds, because who is going to buy the bonds? There is nobody who is going to buy the bonds. Japan can’t buy the bonds, China can’t buy the bonds, Europe and the UK have their own problems. There’s no one left to buy these bonds."
Fed says it’s running out of bullets
There are two possible alternatives. One is that the Fed is expecting a big upturn in the economy, so that there just won’t be a need for more juice in the form of bond purchases. That’s not really the case, however. The Fed only expects the unemployment rate in the mid-7% range by the end of the year, from 7.7% in November. And they don’t forecast any serious inflation issues, either. So the alternative explanation is that the Fed just doesn’t think there’s much benefit to bond buys for the broader economy. The minutes say the program to buy MBS has been “effective” but also that the benefits were “uncertain” and that risks are growing as the balance sheet rises.
2012 Annual Sales of American Eagle Gold and Silver Coins
December sales of American Eagle gold coins totaled 76,000 ounces... Annual sales reached 753,000 ounces, ranking 2012 tenth highest since the American Eagle coin program debuted. December sales of one-ounce American Eagle silver coins totaled 1,635,000...Annual sales ended at 33,742,500 for the third highest total in the Silver Eagle’s 26-year history.
Don't Show Bernanke This Chart Of Gold Loans In India
...don't show him this chart from a just released "Report of the Working Group to Study the Issues Related to Gold Imports and Gold Loans by NBFCs" in India, part of a coordinated campaign to minimize Indian gold demand and imports whose direct substitution to "(un)sound money" in the country is one of the reason being attributed for the nation's high current account deficit (as reported earlier) and why the finance minister said "demand for gold must be moderated." The chart shows the staggering eightfold increase in India's gold loans "which monetize the idle gold in the country", in just four short years.
India Considers Higher Gold Taxes
India, the world’s largest bullion buyer, may raise taxes on gold imports to help tackle a record current-account deficit, Finance Minister Palaniappan Chidambaram said. “We may be left with no choice but to make it a little more expensive to import gold,” Chidambaram said, reading from a statement in New Delhi today. “The matter is under the government’s consideration.” Curbs may crimp gold demand in Asia’s third-largest economy, hurting prices that rallied for a 12th year in 2012 as investors held record amounts in exchange-traded products and central banks stepped up purchases. About 80 percent of India’s current-account deficit is attributable to gold imports, Reserve Bank of India Deputy Governor Subir Gokarn said in November.
Surging prices cut into solar's silver usage
A nine percent increase in silver prices this year, on top of a tripling in prices since end-2008, has forced many panel manufacturers to reduce the amount of metal they use, even though sales of panels are rising. As a result, silver consumption by the industry plunged to 40 million ounces (1,244 tonnes) in 2012 after touching a record of more than 60 million ounces in 2011, following years of rapid expansion, according to metals consultancy Thomson Reuters GFMS. Expectations that prices of the precious metal may rise as much as 38 percent in 2013 will only encourage the industry to further cut usage.
Gold’s Twelfth Straight Gilded Year is a Wrap
Gold finished 2012 with a gain of $109 exactly, which is just shy of seven percent — that’s the metal’s twelfth straight annual rise. The vital statistics on gold ...
Why are (Smart) Investors Buying 50 Times More Physical Silver than Gold?
As long-time students of precious metals investing, there are certain things we understand. One is that, historically, the availability ratio of silver to gold has had a direct influence on the price of the metals. The current availability ratio of physical silver to gold for investment purposes is approximately 3:1. So, why is it that investors are allocating their dollars to silver at a much higher ratio? What is it that these “smart” investors understand? Let’s have a look at the numbers and see if it’s time for investors to do as a wise man once said and “follow the money.”
Light at the End of the Tunnel for Gold
Regardless of which party is in the White House and which party wants to take it back, going back to 1984, the Philadelphia Stock Exchange Gold and Silver Index (XAU) has declined an average of 18.4 percent in the year Americans are busy thinking about voting for a leader. It’s not the end of the world for gold and gold stocks. Take a look at what happens the year following a U.S. presidential election: Going back to 1985, the XAU historically has increased substantially in post-election federal years, rising 23.4 percent, on average.
PwC sees gold and silver miners well positioned for promising 2013
An analysis of the 46 largest TSX-listed gold mining companies show that more than 20% of these companies have cash reserves greater than $500 million, according to the report."There's been a shift in focus with gold executives concentrating on the bottom line-specifically focusing on the rate of return per ounce produced," Gravelle observed.One hundred percent of the senior gold companies surveyed said they used cash to pay dividends this year and will use cash to continue to pay dividends in 2013. Of those, 80% said they plan to increase the proportion of profits paid as a dividend. Only 20% of junior and mid-tier gold mining companies surveyed used cash to pay dividends this year while 28% plan to offer their shareholders a dividend in 2013. Of those planning to offer a dividend, half plan to increase the amount of profits paid as a dividend. Of the senior miners surveyed, 20% spent money on acquisition-related activity this year and only 20% again plan to spend money on acquisition-related activity next year.
UPDATE 3-Iraq adds to gold reserve, 1st time in years -IMF data
The IMF's monthly statistics report showed Iraq's gold holdings quadrupled to 31.07 tonnes over the course of three months between August and October. Brazil raised its gold holdings by 14.68 tonnes, or 28 percent, in November, bringing its bullion reserves to 67.19 tonnes, Thursday's data showed. Meanwhile Turkey cut its gold holdings last month by 5.84 tonnes to 314 tonnes from October. Belarus upped its reserves by 1.39 tonnes to 42.7 tonnes, while Russia, which had both bought and sold gold on a number of occasions this year, increased its holdings by 2.86 tonnes to 937.8 tonnes.
Gold ETFs Fall Below 200-Day Average; First Time Since August
For the first time in months in gold ETFs, we saw more evidence of put buying in SPDR Gold Shares (NYSEArca: GLD) than outright call buying. Interestingly, despite the weak price action in GLD and related long Gold ETPs, there has not been significant redemption activity in terms of assets in either GLD nor IAU (trailing one month net flows in GLD is +$484 million and +$202 million in IAU).Year to date, long Gold ETFs GLD and IAU are still managing to show some green, up 4.62% and 4.86% respectively, and the trailing 5 year numbers are compelling (+103.03% and +102.51% respectively), so there are obviously a bevy of longer term holders that are likely sitting on lofty longer term investment gains at this point.
Silver Vaults Stuffed Means Price Rising 30% in ’13: Commodities
Silver Bullion Pte, one of Singapore’s largest suppliers of coins and bars to retail investors, says sales tripled since October, part of a global surge in demand that drove holdings to a record. Silver Bullion, which started in 2009 in a rented bedroom with 18,000 ounces, now has 246,000 ounces (7.65 tons) stored in vaults for customers as well as its own inventories. The company operates from the Certis CISCO Center, home to one of Singapore’s largest providers of safety deposit boxes. It sells everything from 1- to 32-ounce coins and 10- to 100-ounce bars, as well as gold, platinum and palladium.
Mining Stocks Seen as Cheap Gold Alternative: Chart of the Day
The CHART OF THE DAY displays the ratio of the NYSE Arca Gold Miners Index to the price of gold in New York trading on a monthly basis since September 1993, when the industry gauge was created. Yesterday’s ratio was 0.75, close to this year’s low of 0.70 on May 15. The earlier figure was the lowest since November 2008, when a financial crisis tied to the U.S. housing market’s collapse sent stocks and gold tumbling.
Sprott Physical Platinum and Palladium Trust Announces Initial Public Offering of 28,000,000 Trust Units
TORONTO, Dec. 18, 2012 /CNW/ - Sprott Asset Management LP ("Sprott") today announced that Sprott Physical Platinum and Palladium Trust (the "Trust"), a trust created to invest and hold substantially all of its assets in physical platinum and palladium bullion and managed by Sprott, has agreed to issue in its initial public offering (the "Offering") 28,000,000 transferable, redeemable units of the Trust ("Units") at US$10.00 per Unit, for gross proceeds of US$280,000,000. As part of the Offering, the Trust has granted the underwriters an over-allotment option which is exercisable in whole or in part to purchase up to an additional 4,200,000 Units at US$10.00 per Unit.
China’s Major Role in Silver Explained
The structure of the silver industry in China is almost unrecognizable from the situation 20 years ago, a new report from Thomson Reuters GFMS states. In 1990, China was a relatively small player in silver. Now, the nation is responsible for 17 percent of global demand and produces 14 percent of the world’s silver. GFMS’ latest research reveals that China’s expanding role in the silver market has been driven by the liberalization of its silver industry and over a decade of economic growth.
Silver Deceptions: Large Surpluses & Low Production Cost
There are two misconceptions about the silver market that are still held by many investors in the precious metals community. One is the notion that the world produces large annual silver surpluses and the other is the low cost of mining silver. Some have argued that the investors have been deceived by certain aspects of the silver industry to believe these two fabrications. If the silver institute determined the annual silver surplus-deficit the same way as the World Gold Council calculates gold, there would be no so-called huge silver surpluses. However, the silver industry and investors have been indoctrinated to believe that silver is just a mere slave to fulfill the demands of its industrial masters. Institutions, individual investors or the public who have the “need” or “use” to acquire silver as investment — need not apply.
We published two graphs on the following page. The first is a time series of spot gold and our Shadow Gold Price (SGP) from 1973 to November 30, 2012. (The SGP uses the Bretton Woods monetary calculation for valuing the fixed exchange rate linking gold to the US dollar – Base Money divided by US official gold holdings.) As the top graph shows, since the US dollar has been baseless with a floating exchange rate, there has been significant base money creation, with the vast majority of it coming following the 2008 credit event. The SGP implies the level where spot gold would trade if the purchasing power of base money were held constant. The gap separating the SGP from spot gold indicates the implicit arbitrage representing already reduced implicit purchasing power from holding US dollars vis-à-vis the potential gain of purchasing power from holding spot gold now.
Insiders warming up to gold stocks, says latest INK Research report
“They have been buying as their stocks bucked the upward trend seen in other sub-sector groups. Unlike most areas of the Canadian market, insider sentiment among precious metal stocks has been trending higher and now the group’s indicator stands at 321 per cent, up 110 points since November 15th.”
Gold Testing 200-Day Moving Average
As equities surged today, gold sank. Unfortunately for gold bulls, the metal closed below a support level that had formed from its early November low. The metal did manage to hold support at its 200-day moving average, however. A break below the 200-day in the coming days will not make for a good end to the year for those long the commodity.
Indian gold ETF holdings now exceed $2.1 billion
Investor demand for gold has not waned in India despite rising prices. Indians' love for gold has pushed the size of assets held through gold exchange traded funds (ETFs) to an all-time high of $2.1 billion (Rs 119 billion) in the country. `With gold prices rising sharply, many retail investors have turned to ETFs as an investment and hedge against inflation. Moreover, with the country's financial markets evolving, products like ETFs have given individuals new ways of investing,'' noted Gaurav Mashrukwala, a financial planner. In the three months of September to November, the Association has held that inflows worth nearly $182 million (Rs 10 billion) have come into gold ETFs. In 2011-12, over $657 million (Rs 36 billion) was pumped, while $410 million (Rs 22 billion) inflows came in 2010-11.
John Embry - Chinese Demand For Silver Has Exploded
Today John Embry told King World News Chinese demand for silver has skyrocketed. He also spoke about what to expect in 2013 for gold, silver and the global economy. Here is what Embry, who is chief investment strategist at Sprott Asset Management, had to say: “They are still mumbling about the fiscal cliff and there seems to be limited progress on that front. I suspect they will get something cobbled together instead of letting this get to an extreme point because if they let this thing go over the cliff it would be disastrous.”
Bear Market for Juniors at 22 Months, Reversal Near?
HOUSTON - The ongoing bear market for the smaller, less liquid and more speculative issuers in the mining and exploration biz - like the ones represented by the Canadian Venture Exchange Index or CDNX below - has now reached 22-months in duration. That's a very long time for a bear market, folks. Remarkably, the CDNX is currently trading at a level first reached in 2002, a decade ago, when gold traded below $350 the ounce and silver was under $5. With gold now in the $1,700 arena and silver with a $32 handle, we view the current level of the Venture Index as a psychological anomaly.
World's biggest, savviest investors to crowd gold and silver markets says Sprott founding chairman
It's interesting to see the big money starting to be attracted to the sector. It's interesting to see that point of view being shared by the largest aggregations of capital on the planet. There are oceans of capital looking for a home.There are literally trillions of dollars looking for a home.
Gold Funds Own a Central Bank-Sized $144B Hoard
Another interesting tidbit on gold ETFs and other exchange-traded products: More than two-thirds of all the money around the world in global commodity exchange-traded funds is invested in the yellow metal. There is $206 billion in total commodity exchange-traded product assets. Gold gets 70%. Broad commodity funds have 10%, silver has 9%, and energy funds enjoy just 4%. The remainder is scattered among assorted other commodities. While 2012 has been kind to the U.S. SPDR Gold Trust (GLD) and the iShares Gold Trust (IAU), Europe has seen the biggest burst of gold-happy asset flows. Forty-six percent of global gold-fund inflows were located there, according to BlackRock.
China now world's largest market for silver investment
China's growing importance to the global silver market has been fueled by more investment demand, modernized mining practices, and the nation's status as the world's 2nd largest silver fabricator, says Thomson Reuters GFMS. In 2011, China's demand for silver bars and coins soared to 17 million ounces, accounting for 8% of worldwide net purchases of physical silver.The report, The Chinese Silver Market, forecasts growth in China's domestic silver mine production over the next couple of years. "This growth is premised on a strong project pipeline from primary silver mines, coupled with ongoing gains in silver produced as a by-product of base metals and gold mining,"
Gold CEOs Told to Fix Slump as Investors Prove Restless
Gold-mine investors are losing patience with management in the $60 billion industry as their shares head for the first back-to-back annual slump since 1998, even as the metal completes a dozen years of gains. Producers from Canada's Barrick Gold Corp. (ABX), the world's biggest, to Newmont Mining Corp. (NEM) of the U.S. are failing to control expenses. The average cost to extract an ounce of gold by the largest miners jumped 23 percent to $584.70 in 2011, data compiled by Bloomberg show. In contrast, silver production costs fell 12 percent to the lowest since 2007, the data show.
Gold & Silver Hammered in Globex After QE4 Announcement
Another counter-intuitive smash of gold and silver prices is in progress, as gold has been smashed $30 and under $1700 from it’s post QE4 announcement high near $1725, and silver has been smashed $1.15 from $33.92 to $32.77.
Huge fall in South African gold output in October
South African gold output continues to decline with a big fall in October, largely due to the wildcat strikes which closed down much of the industry during the month. According to Statistics South Africa, the country's gold output fell by 45.7 percent in volume in October while total overall mineral production was down 7.7 percent compared with the same month in 2012. Copper production fell by an even greater 56.4% year on year, but this is far less significant for the country's economy.
Germans buy more gold on economic uncertainty
Germans are increasingly buying gold because of fears about economic uncertainty and a third of them are now considering gold as part of their investments, a study from German precious metals group Heraeus Holding GmbH said on Tuesday.There had been increased gold demand from German investors in recent months because of worry about actions taken by the European Central Bank and U.S. Federal Reserve as the two central banks sought to counter the euro zone crisis and slow U.S. economic growth, the study said.German private investors now owned 8,000 tonnes of gold, Heraeus said. About half of German private investors kept their physical gold at home, it said.
Silver sales set to outshine gold in India
India Investors in India are bullish on silver, saying the white metal is in position for a potentially spectacular move over the next year and more. Related Stories. Indian retailers are bullish on silver. With supplies tightening, deliveries are slowing down this week in the bullion market in Mumbai. What has also buoyed sentiment is that silver continues to lead precious metals, and sales have jumped over 24% this year. During 2011-12, silver jewellery exports grew to 44% as compared with gold jewellery exports of 30%. India is the biggest consumer of white metal jewellery, and has also found a new class of buyers in the West.
Sales of American Eagle Gold Coins Soar
Demand for gold coins in the US has soared since the presidential election, as small investors fret about the lack of action to address America's ballooning debt.The US Mint's sales of American Eagles, one of the most popular gold coins, leapt 131 percent in November, hitting their highest level in more than two years. The Royal Canadian Mint also had its strongest month of sales this year.Terry Hanlon, president of metals at Dillon Gage, one of the largest bullion dealers in the country, said sales had risen sharply "within a day or two" of the election.
Silver surplus - what silver surplus?
The graphic thus indicates that although silver is technically in surplus, in reality it is nothing of the kind with huge pent up investment demand more than taking up the available supply.
IMF study in 1999 found 80 central banks lending 15% of official gold reserves
A study by the International Monetary Fund in 1999, obtained last week by GATA's researcher R.M., reported that more than 80 central banks had lent 15 percent of official gold reserves into the market and that central banks then lending gold included the German Bundesbank, the Swiss National Bank, the Bank of England, the Reserve Bank of Australia, and the central banks of Austria, Portugal, and Venezuela.
Gold Imports by China From Hong Kong Decline on Weaker Demand
Gold, which slipped 2.9 percent in October, is in the 12th year of a bull run as investors seek to hedge against weaker currencies as central banks around the world take action to boost economic growth. China’s gross domestic product is poised to expand 7.7 percent this year, the weakest pace since 1999, according to a Bloomberg survey. Growth was 7.4 percent in the three months through September, the weakest in three years.
Gold rises from 1-month low after U.S. payrolls
Investors' appetite for physically backed funds held firm,with holdings of gold exchange-traded funds hitting record highs at 76.133 million ounces on Thursday. However, gold imports from Hong Kong to China, one of theworld's top bullion buyers, fell in October to their lowest inten months, data showed on Friday.
S.Africa's Rand eyes gold refining plant in China
The world's biggest gold refiner, South Africa's Rand Refinery, is considering setting up a refining plant in China within two to three years, joining hands with a local partner on its first such plant abroad, a senior executive said on Friday. Rand's China refinery would rely on locally sourced scrap and dore, an unrefined alloy of gold with variable quantities of silver and smaller amounts of base metals, Bouwer said.Rand, the biggest supplier of bullion to China, is likely to ship about 100 tonnes of gold kilo bars into the country this year, similar to last year, the firm's chief executive told Reuters last month.
Mystery Asian gold sales may be prelude to buying
"We're actually seeing a fairly mysterious seller in the Asian time zone over the last week," says Jeffrey Rhodes, CEO of INTL Commodities in Dubai, quoted by Emirates 24/7. "We've seen some fairly large sell orders hit the market in the thinly-traded twilight zone" between London and Asian business, Rhodes says. "Maybe that [push to lower prices] is a prelude to buying gold...Either way, many players are closing their books for the year – they've either made what they’ve made for the year, or they’ve lost and don't want to lose anymore." "There is some heavy selling by fund investors and leveraged money," agrees Miguel Perez-Santalla, vice president for the Americas here at BullionVault.
Aboveground Gold Stock Likely Small Than Commonly Thought
GoldMoney's Andy Duncan interviews James Turk, Chairman of GoldMoney and co-author of The Collapse of the Dollar, about his study of the aboveground global gold stock, gold’s role as money, and the coming fiat currency collapse. They discuss the discrepancies between official gold stock figures and the study's carefully calculated figures, going all the way back to Roman times and using the year 1492 as a pivotal calculation point – which was when the Spanish Empire began its imports of gold deposits discovered in the Americas. In contrast to the widely referenced number of 171,000 tonnes of aboveground gold, James’s study suggests that it is actually closer to 155,000 and therefore overstated by about 10%.
BIS gold report hints at repatriation by central banks
Since March 2009 there has been a marked change in the source of the gold deposited by the BIS with central banks in gold sight accounts. It has fallen from 1,197.45 tonnes as of March 31, 2009, to 509.43 tonnes as of September 30, 2012. By March 2010 the BIS had sourced 346 tonnes of gold in the form of gold swaps -- something that had not been done for many years previously or at least not disclosed. ...the reduction in the amount of gold deposited with the BIS in sight accounts is consistent with a desire by owners to exert greater control over their gold. Further, one could reasonably speculate whether gold swaps (and their increased proportion as a source of gold for the BIS gold banking business) have been used by the BIS to supply gold to avoid a default by a central bank when being asked to return the unallocated gold held in a sight account deposited with the BIS as the BIS has faced a reduction in that source of unallocated gold itself.
South Korea central bank bought 14 tonnes of gold in Nov
South Korea's central bank said on Wednesday it bought 14 tonnes of gold in November using its foreign reserves in order to spread its portfolio risks, while releasing data showing total reserves rose after talk of market intervention. The Bank of Korea now holds 84.4 tonnes of gold, valued at $3.76 billion in terms of purchase prices, up nearly six-fold from 14.4 tonnes before June last year.
Show us the money, BlackRock tells lagging gold miners
The gold mining sector could end a period of dramatic underperformance by ceasing to chase volumes and improving returns to shareholders, according to BlackRock , the world's largest money manager."It is not rocket science. It really is very simple," Hambro said. "It just requires a greater element of discipline, for management not to chase volume growth, and delivering returns for shareholders - the people who really own the company." The oil sector pays out 45 percent of profit, while gold pays out only 25 percent. "We are starting to see some bright spots, dividends are starting to rise, but it is only a very narrow group that is doing this," he said.
Turkey's Nov gold imports rise to 4.2 tonnes
Turkish gold imports rose to 4.2 tonnes in November from 3.7 tonnes a month earlier, according to data released by the Istanbul Gold Exchange on Tuesday. Gold imports in the first 11 months were 117.2 tonnes. In 2011 as a whole, imports amounted to 79.70 tonnes, almost doubling from 42.49 tonnes a year earlier.
DEUTSCHE BANK: 3 Reasons To Be Bullish On Gold
1. ...the impact of QE3 on bank reserves has been modest thus far. That may explain in part why gold is lagging previous QE cycles (see discussion). As base money expands, gold prices should be supported (particularly if we see further dollar weakness). 2. US long-term real rates are staying in negative territory. 3. China’s gold demand will continue to exceed supply over the next few years. The Ministry expects that in 2015 China’s gold demand could exceed 1000t while domestic supply could only reach 450t.
First Guns… Now Gold
“There is a huge influx of new high-net-worth individuals that are buying a lot of gold, and they are taking physical possession of it,” David Beahm tells Reuters: He ought to know: He’s vice president at bullion retailer Blanchard & Co. “This quarter,” he adds, “is shaping up to be one of the best since the last quarter of 2008.”
Silver set for spectacular bear squeeze
Following a routine decline in both gold and silver on the US futures market last week due to the heavy short positions held by key market players, veteran precious metals adviser Alasdair Macleod says silver bears are about to be wrung out.
Australian gold production fell in Sept quarter
Gold output in Australia fell by some two tons during the three months to September, compared with the previous quarter, and by nearly five tons compared with the previous corresponding period, mining consultancy Surbiton Associates reported this week. “The fall in production was disappointing, given the new operations that have just come on stream,” said Surbiton Associates director Dr Sandra Close. “Many of the larger gold mines, mostly in Western Australia, had technical issues which reduced their gold output. Hopefully this situation will be short-lived.”
The Chart That Keeps Ben Bernanke Up At Night
Something appears to have snapped in the American psyche as the last 30 days have seen the largest physical gold sales on record. Between the search volume for 'bulk ammo' and this, we fear something is afoot and while Congress fiddles as our economy burns, Bernanke going 'back to work' is perhaps what the physical 'horders' are thinking...
China Moves Forward in Opening Gold Market
China will allow over-the-counter gold trading between banks for the first time Monday, a significant financial reform for the world’s second-largest buyer of the precious metal. The move reflects the Chinese government’s latest effort to develop Shanghai into a major gold trading center, and mirrors similar developments in the country’s currency and oil markets.
US gold coins set for strongest November sales in 14 years
November sales of U.S. AmericanEagle gold coins are set to be the strongest in 14 years asuncertainty surrounding the U.S. fiscal crisis and thepresidential election triggered safe-haven buying, dealers said. Occasional sharp price swings during early and late Novemberalso boosted bullion coin buying by investors and speculators alike, coin dealers said.
Gold Holdings Surge As Fiscal Cliff Talks Stall
With jittery markets jumping 100 points one way, then 100 points the other on any headline related to the fiscal cliff, it may seem difficult to find a safe place to park one’s money. But, there may be a port in the storm: gold. ETF holdings of physical gold are at or near all-time highs as investors pile into the yellow metal, not really as a “safe haven” but more as a hedge or as an insurance policy, according to Nick Brooks, head of investment strategies and research at ETF securities. And gold, it seems, will benefit from any scenario, but if you’re thinking Congress and President Obama will drive us off the fiscal cliff, then it may be just the place to be. “The best thing for gold right now is a disaster,” explained Brooks. “The key trend here is the massive flow into gold ETFs, with holdings at all-time highs above $150 billion,” said the strategist, noting that institutional investors are moving into the precious metal as a hedge for a policy mistake that may be in the works.
Upside for silver to crest $50/oz in 2013 – GFMS
TORONTO (miningweekly.com) – As a result of significant investor demand for silver as an alternative investment metal in the current uncertain global economic environment, precious metals consultancy Thomson Reuters GFMS on Thursday said the price for the white metal could top $50/oz in 2013. During a webcast to present the preliminary findings of the GFMS' 'Interim Silver Market Review’, global head of metal analytics Philip Klapwijk pointed to strong investment demand, albeit in a small market, and the rising intertwined gold price, which would lift the price of silver to between $33/oz and $47/oz, with a 25% probability of significantly higher prices.
China 2015 gold output likely 450 tons: ministry
BEIJING--China aims to have domestic gold production reach 450 metric tons by the end of 2015, a rise of around 25% from 2011, the Ministry of Industry and Information Technology said Monday.The ministry forecast rising domestic demand for gold and a "huge amount of room" for the industry's development due to gold's safe-haven and wealth-preserving properties, it said. Still, domestic consumption is likely to exceed 1,000 tons by the end of 2015, "widening the fundamental market shortage," the ministry noted. By the end of 2015, China is likely to have gold reserves of 8,000-9,000 tons, an increase of 20% from 2010, it said, without specifying if these were state reserves.
US easing a worry but gold profits help, CIC chief says
China's sovereign fund chief concerned over US money printing, but pleased with gold purchases. America's indebtedness and repeated monetary easing is a matter of grave concern but gold offers a glimmer of hope in these times, according to China Investment Corp (CIC) president Gao Xiqing.Gao, who runs China's US$482 billion sovereign wealth fund, said he is "not quite convinced" about the US economic system, which he said makes the government print money to satisfy the needs of certain interest groups."You cannot spend more than you make. Once you go down that road, it's very, very difficult to come back," Gao said at a financial summit organised by Caijing magazine yesterday in Beijing. "We are worried. That's why we took Ray's suggestions" to buy gold, he said. Gao was referring to his friend Ray Dalio, founder and chief investment officer of Bridgewater Associates, who invested heavily in gold when the price was only a third of the current level.
Are the Netherlands' gold reserves real? MPs want answers
Questions have been asked in parliament about the location and value of the country's gold reserves, most of which is said to be in foreign vaults, news agency ANP reports on Wednesday.The Netherlands is said to have 612 tonnes of gold, with a value of some €24bn. Just 10% of it is held at the central bank headquarters in Amsterdam. The rest is in bank vaults in the US, Canada and Britain.Socialist and Christian Democrat MPs are now asking if it is sensible to keep the gold abroad and want to know how pure the gold bars actually are. The questions follow a decision by Germany's Bundesbank to carry out a formal inspection of its gold reserves, most of which is being held in other countries.
Indians hoard 20k tonnes gold worth record $1.16 trn
New Delhi: Indian households have piled up as much as 20,000 tonnes of gold, worth $1.16 trillion, an historic high. This shows that the government’s efforts to trim overseas purchases of the idle asset by imposing an import duty and raising it in short intervals to reduce the current account deficit (CAD) haven’t yielded the desired results.The World Gold Council’s (WGC) latest estimate of India’s household gold reserves is 11% higher than the 18,000 tonnes it had been pegged at earlier. Coupled with 557.7 tonnes of the central bank’s holdings, gold stocks at known sources in the world’s largest consumer would represent more than 75% of its gross domestic product.
Profit taking, fat finger or take-down? – gold crashes again
Big 24 tonne gold futures sales designed to put the frighteners on gold investment but may just be providing opportunities for those with a more long term outlook. Reports of a massive 24 tonne sale of gold futures at precisely 8.20 am New York Time this morning just ahead of market opening there, saw a drifting gold price fall off a cliff with a $26 drop in a couple of minutes and a further downwards slip thereafter. If profit taking, offloading that kind of quantity of gold at one shot seems a strange way of doing so – or inept as Ross Norman of Sharps Pixley puts it. The fat finger possibility (keyboard error), which has been used to explain similar falls in the past when gold looks to be beginning to regain its lustre, seems, as ever, unlikely and we are left with the intentional take-down of the gold price by persons or institutions unknown as seemingly the most likely answer to what has happened.
Gold & Silver COT Report 11/26/12: Commercials Add A Massive 21 Million Net
Commercials added a huge 1,622 longs on the week and increased a massive 5,847 shorts to end the week with 47.24% of all open interest, a large increase of +0.70% in their share since last week, and now stand as a group at 275,930,000 ounces net short, which is an increase of over 21,000,000 net short ounces from the previous week.
Big miners keep on drilling as juniors freeze up
Big mining companies may be pulling back on major new spending plans, but they haven’t let up on exploration budgets, according to Major Drilling Group International Inc., which has a bird’s-eye view on the mining world as the second-largest resource driller. Chief executive officer Francis McGuire says the same cannot be said for junior miners, which have been stripped of access to financing amid tumultuous global markets, forcing them to virtually freeze drilling activities. “The junior market is very dead,” Mr. McGuire said in an interview on Tuesday, adding that most drilling proposals for the 2013 calendar year are coming from senior miners, intermediaries and some very well-funded juniors.
GFMS: Silver Industrial Demand to Reach New High in 2014
Investment demand for silver often takes center stage, but industrial demand should not be overlooked. In 2011, industrial demand was strong for the first three quarters, but then saw close to a 4 percent decline and fell sharply towards year end. A newly released report from Thomson Reuters GFMS states that the Silver Institute commissioned GFMS to conduct an investigation against a backdrop of uncertainty carried over from 2011 to 2012. The results reveal a decline and recovery cycle that will see industrial demand reach a new high in 2014. GFMS states that not only does the industrial sector play an important role in consumption, but it is also crucial in offsetting the declining use of the white metal in photography and silverware. These two segments accounted for over one-third of silver fabrication demand in 2000, but fell to only 13 percent in 2011.
Can we trust China’s gold reserve figures – or anyone else’s either
China continues to grow its annual gold output but should we believe its statistical presentations of gold supply and demand any more than other governments? According to a Reuters report, China’s Ministry for Industry and Information Technology has put out a statement suggesting that the country’s gold output will continue to rise over the next three years to reach between 420 and 450 tonnes per annum, thus comfortably retaining its position as the world’s largest gold producer. It also predicts Chinese consumption of some 1,000 tonnes of gold per annum by then.
MASSIVE SILVER RAID IN ACCESS MARKET TRADING AS SILVER FLASH SMASHED TO $31.80
Today it is apparently silver’s turn, as numerous platforms recorded a flash crash in silver from $34.10 to $31.80, almost immediately regaining the $34 level. This time the $2.30 nosedive might not have been a data glitch, as the chart indicates several ticks on the move down, as well as at least 5 trades occurring on the violent move back through $34. Whether a data glitch or a real algo event, the smash was so instantaneous that it has already been erased from the charts: Kitco however still shows $31.80 as the day’s low.
Brazil Gold Reserves In Fixed Term Gold Deposits With Bullion Banks
Brazil raised its gold holdings by 17.2 tonnes in October to 52.5 tonnes, the highest level since January 2001. The move comes on the back of Brazil's 1.7 tonne increase in September, the country's first significant gold purchase in a decade. However, there are concerns that the increase in the Brazilian central bank gold holdings' and tonnage are not all that they seem. It appears that the central bank in Brazil has not actually bought London Good Delivery bullion bars but rather fixed term gold deposits with bullion banks. Recently, the Brazilian central bank was asked about their gold reserves and about a section on gold on their website under 'Official Reserve Assets' lists gold as "gold (including gold deposit and, if appropriate, gold swapped)" with a footnote of "Includes available stock of financial gold plus time deposits." Although Brazil's central bank declined to comment on the reason behind its recent return to gold purchases, the Banco Central do Brasil confirmed that the gold included in Reserve Assets comprises fixed term gold deposits at commercial banks only.
The Soros Position Nobody is Talking About
In the most recent 13-f filing on November 14th, the Soros fund increased its position in gold via the GLD fund from 884,400 shares, to 1.3+ million shares. That represents a sum of about $200 million. The fund increased its position in the GDX gold miners ETF from 1 million shares, to over 2.3 million, it added a 1.7 million share position in Kinross Gold, and finally, maintained a nearly 2.4 million share position in the GDXJ junior gold miners ETF.But it seems I left something out. Along with all the other financial news editors. The Soros Fund added what appears to be a $9 million call option position on the GDX.
US Mint Sales: Commemorative Coins Surge, Products Debut
US Mint Sales: Bullion Gold and Silver Coin Products Bullion sales pulled back from the levels of a week ago, but November is already a robust month with still another week to ago. In month-to-date comparisons: Gold Eagle sales at 67,000 ounces surpass the 59,000 ounces in October and the 41,000 ounces in November 2011. Gold Buffalo sales at 10,000 are 1,000 away from matching October and top the 8,500 in November 2011 Silver Eagle sales at 2,584,500 are on pace to hurdle the 3,153,000 in October and are well above sales of 1,384,000 in November 2011.
Government may issue gold bonds
With savings rates dropping from 35% about five years ago, the government, trying to boost savings and discourage hoarding of gold in physical form as a speculative activity, is planning to soon come out with attractive paper products including gold bonds, riding on India’s craze for gold.
Fed's Williams: Fed Not Near Limit on Bond Buying
"Our concern is to make sure our policies aren't creating problems with market functioning. In terms of how far you can go, I don't think that we're anywhere near any kind of limit to that in terms of our current policies, and I expect that to continue well into next year. I don't think we're getting close to a constraint in that. Conceptually you could imagine some upper limit to this but I don't think we're getting anywhere near it." The Fed next meets Dec. 11-12. It is widely expected to continue its $40 billion-per-month mortgage-bond-buying program. It must decide what to do about its Treasury purchase program, known as Operation Twist. Under the program, which expires at year-end, the Fed is buying $45 billion per month of long-term Treasurys.
Industrial silver demand to decline 6% this year – Silver Institute
Silver Institute ... forecasts a downturn in silver industrial demand this year to 454.4 million ounces, "although a recovery in 2013 will see these losses entirely recouped. Looking ahead, the report anticipates a 6% rise in industrial silver demand to a new record high in 2014 of 511.6 million ounces, which will account for 57% of total silver fabrication in that year.
Brazil raises gold holdings by 17.170 tonnes in Oct-IMF
Brazil raised its gold holdings by 17.170 tonnes in October, data from the International Monetary Fund showed on Wednesday, bringing its bullion reserves to 52.518 tonnes. The IMF's monthly statistics report also showed that the euro area had lowered its gold holdings by 4.168 tonnes to 10,783.609 tonnes in October. Meanwhile Kazakhstan raised its bullion reserves by 7.527 tonnes to 111.543 tonnes. Turkey raised gold holdings by 17.543 tonnes to 319.907 tonnes in October. It also revised its September figures upwards by 6.843 tonnes to 302.361 tonnes, the data showed. (Also, Russia bought 0.4 ton)
Soros Buying Gold as Record Prices Seen on Stimulus
Gold’s 12-year rally, the longest in at least nine decades, is poised to continue in 2013 as central bank stimulus spurs investors from John Paulson to George Soros to accumulate the highest combined bullion holdings ever. Soros Fund Management LLC increased its holdings by 49 percent in the third quarter, U.S. Securities and Exchange Commission filings show. Paulson... raised his stake by 26 percent in the second quarter and his holding of about 66 tons exceeds the official reserves of nations from Brazil to Bulgaria to Bolivia. Paul Touradji’s Touradji Capital Management LP sold all of its 82,000 shares in the SPDR Gold Trust in the third quarter, according to an SEC filing. Lone Pine Capital LLC, the hedge fund run by Stephen Mandel Jr., cut its stake by 31 percent to 2.6 million shares, and Dan Loeb’s Third Point LLC lowered its bet by 10 percent to 130,000 shares, filings showed last week. Options traders are also bullish, with the eight most widely held contracts conferring the right to buy at prices from $1,800 to $2,200 between November and March, Comex data show.
Gold buying grows as Indian festival season heats up
Chhath Puja is a 4-day festival where devotees fast without water for more than 24 hours and worship the Sun. There are many rituals that are followed in these four days, which fall on the sixth day after Diwali, notable amongst them being the buying of gold as prayers are offered. The occasion of the Chhath festival, celebrated across India, turned golden this year, giving a fresh impetus to gold buying... with retailers expecting a record number of kilogram gold sales this year.
Niall Ferguson On China's Gold And The "Tremendous Flux In International Order"
From China's need to begin privatizing SOEs and globalizing the RMB (with an interesting focus on the introduction of reliable property rights to 'enable' the middle class) to concerns about its large dollar holdings (and the top-down and bottom-up diversification into gold that continues); Ferguson notes that the ongoing attempt to diversify its wealth and revenues (stock and flow) is relatively limited by the ability to secure hard assets but adds that as the world's 'trade' center of gravity shifts east at a very fast pace so gold will flow from "the West to the rest" as Western power declines and the Asia bloc rises.
Basel III And Gold
Both Basel I and II took the then fashionable view of what money is - government bonds, mortgage backed securities, cash, etc. Gold was included in what they allow as capital, but as a "tier 3 asset" (not real money), and thus was only allowed to be reserves for loans at just 50% of its market value, much like, say an art collection would be. The most significant change is moving gold from its tier 3 status to tier 1 capital as 100% loan-backing reserves, the same as cash and bonds. For the first time in 42 years, gold is being brought back into our financial system as money. All the world's banks are now storing this metal, not as some 3rd rate "asset," but as all the world's working capital - its money. The second part of the Basel III accords I want to focus on is the requirement to, not only include gold in tier 1, but to raise minimum tier 1 capital reserve backing of loans and all other risk assets, the tier 1 capital ratio, from the current 4% to 6%. This is a 50% increase, which is a big jump for this fairly stable number.
CME lowers gold, silver, copper, natgas margins
Nov 15 (Reuters) - The CME Group on Thursday lowered margins for natural gas, gold, silver, copper, lean hog and live cattle futures, effective after close of business on Tuesday, Nov. 20. CME, the biggest operator of U.S. futures exchanges, cut initial margins on COMEX 100 Gold Futures 18.5 percent to $7,425 a contract from $9,113, but left maintenance margins for the yellow metal unchanged. The exchange operator trimmed maintenance margins to trade silver to $11,000 per contract, from $12,500, and initial margins to $12,100 from $16,875 per contract.
India gold demand revives, imports up in Sept quarter: WGC
India’s gold demand revived in June-September quarter 2012. According to data compiled by the World Gold Council (WGC), gold demand totalled 223.1 tonnes, up 9% year-on-year from 204.8 tonnes in Q3 2011.
World gold demand slides in Q3 as China's economy bites-WGC
Global gold demand dropped 11 percent in the three months to September from record levels seen in the same period last year, dampened mainly by fading Chinese fervour as its economy slowed, with stronger Indian demand stemming a larger fall, the World Gold Council said. Chinese gold consumption fell 8 percent in the July to September period to 176.8 tonnes, the WGC's quarterly demand trends report showed on Thursday, with both jewellery and investment demand hurt by a slowing economic growth.
Fed Minutes Show Interest in Extending Bond-Buying Effort
Minutes of the Fed’s Oct. 23-24 policy meeting, released on Wednesday, suggested that it would unveil a Treasury-buying plan to replace a program that expires at the end of the year. Under that program, Operation Twist, the Fed has been selling $45 billion a month in short-term Treasury bonds and using the proceeds to buy an equal amount of longer-term securities. When Operation Twist ends, the Fed will run out of short-term investments to sell. The minutes showed support among Fed policy makers to replace Twist with another program of long-term bond purchases.
Indian gold demand seen recovering in 2013 - bankers
(Reuters) - India's gold demand is expected to recover next year, largely due to an expected increase in jewellery purchases after a difficult 2012 during which sales dropped due to higher import taxes and a weak rupee, industry officials said on Tuesday. This year, jewellery demand fell by 35 percent compared to 2011, he said on the sidelines of a metals conference in Hong Kong. "In 2013 there will be 23 percent more wedding days than this year," Bhandari added. India's government raised duties on gold imports to curb imports to $38 billion in the current fiscal year from $58 billion in 2011/12 as it seeks to rein in its current account deficit and encourage money tied up in gold back into the economy.
China Says It Must Add To Gold Reserves To Promote Yuan Globalization And As An FX Hedge
Two days ago we showed that the relentless importing of gold in China continues, yet what has been missing is an update direct form the horse's mouth how China feels toward gold (because we certainly know how it feels toward US Treasury paper). Today, we finally got one straight from Beijing, and that during a very carefully supervised time when the 18th Communist Congress is still in session, and every word out of China has profoundly telegraphic implications. China needs to add to its gold reserves to ensure national economic and financial safety, promote yuan globalization and as a hedge against foreign- reserve risks, Gao Wei, an official from the Department of International Economic Affairs of Ministry of Foreign Affairs, writes in a commentary in the China Securities Journal today. While gold prices are currently near record highs, China can build its reserves by buying low and selling high amid the short-term volatility, Gao writes in newspaper.China’s gold reserve is “too small”, Gao says.And there it is: while many have speculated that China, which has not given an update of its official holdings in nearly 4 years, is quietly building up its gold reserve holdings behind the scenes.
China Lags U.S. in Gold Holdings, May Raise Total, LBMA Says
The Chinese government may add more gold to its reserves as the precious metal accounts for a lower share of total holdings compared with the U.S., according to the London Bullion Market Association.“When comparing China to the U.S., it would seem that in China, gold asset allocation can only go in one direction,” Chairman David Gornall told the association’s annual conference in Hong Kong. “The country has only 2 percent of its reserves in the form of gold compared with the U.S. at 75 percent.”
Embry: China To Import A Staggering 775 Tons of Gold In 2012
“But now they are buying the world’s gold at an ever-increasing rate. At this point, based on the imports through the first nine months of the year, if you pro-rated for the last three months, they would for the full year have imported a staggering 775 tons of gold.Well, if you take that as a percentage of the non-Chinese production, that’s about 1/3 of the non-Chinese mine production that’s going into China. This wasn’t happening two years ago. So my question is, where is the gold coming from?.... “After Chinese imports are subtracted from yearly production totals, that only leaves about 1,500 to 1,700 tons of gold for the rest of the world, and there is way more demand than that in the rest of the world. So I continue to believe there is Western government dishoarding of gold, but that has a finite life span because I think the physical shortages are intensifying.”
China's Filipino Gold Rush
Bypassing Customs Proves Lucrative for Mainland Miners. A vast and growing river of gold, much of it illegal, is being mined in the Philippines by Chinese companies and is pouring into Hong Kong before most of it is transshipped into China. The Philippines is the third biggest exporter of gold coming into Hong Kong after Switzerland and China itself, according to official data, with shipments rising to a peak of 81.5 tonnes in 2010 against just 11 kg nine years earlier, according to a Reuters report on Aug. 23. Shipments from the Philippines were steady at 81.2 tonnes in 2011. Hong Kong has become so important a transshipment point for gold that in July, the Israel-based Malca-Amit Global Ltd announced on Bloomberg that it had opened a bullion storage facility capable of holding 1,000 tonnes at any given time – 22 percent of the gold in the fabled US storage facility at Fort Knox, Kentucky. A company official declined to comment on either the direction in or out of gold and other valuables shipments. According to records with the Hong Kong Customs and Excise Department, although they don’t give the direction or source, gold shipments into Hong Kong skyrocketed by 215 percent to HK$70.63 billion (US$8.22 billion) in the first six months of 2012 and exports from Hong Kong rose by 89.1 percent, to HK$27.5 billion.
Gold Industry Facing Mine Discovery Challenge, Barrick Says
Gold discovery rates are decreasing even as exploration spending in the industry reached a record $8 billion last year, according to Jamie Sokalsky, chief executive officer of Barrick Gold Corp., the world’s largest producer. There were three discoveries last year, compared with 11 in 1991, and none of those can be described as “supergiant,” or holding more than 20 million ounces, Sokalsky said at a conference in Hong Kong. Breakeven costs were rising, he said today, predicting gold’s bull market shows no signs of ending. “I don’t see a surge in gold production if we saw a gold price of $3,000,” Sokalsky said. “At a higher gold price, we’d still be experiencing the same challenges. I’d suggest there’d be very limited response to that higher gold price.”
Gold sales surge by up to 30% on Dhanteras
NEW DELHI/MUMBAI: Gold sales rose by up to 30 per cent today as demand for wedding jewellery attracted more buyers on the auspicious Dhanteras despite high prices.Currently, gold prices are ruling around Rs 32,000 per ten gram in the national capital and Rs 32,100 in Mumbai."Although we were not expecting, sales have been very good. We expect better sales compared to last Dhanteras," P C Jeweller, Managing Director Balram Garg told PTI. P C Jeweller has 30 showrooms across the country. Another city-based P P Jewellers Director Pawan Gupta said, "The rush of buyers clearly indicates that high prices have not dampened demand. We expect 25-30 per cent sales." As the Dhanteras muhurat is till 2 PM tomorrow and the gold buying will continue, he added.
German Calls for Gold Repatriation Intensify As Fed Refuses to Allow Inspection
Calls for Germany to repatriate its 1,536 tons of gold reserves held at the NY Fed are intensifying as Der Spiegel reports the Federal Reserve has refused to allow German inspectors to even view the country's massive gold reserves "in the interest of security and of the control process".Tourists are allowed to venture below street level to see the vault. After descending in an elevator, they stand in front of an enormous steel cylinder that pivots like a door in a 140-ton steel-and-concrete frame. But not even the owners are allowed to view their own gold. According to the Federal Audit Office report, the Fed explained that "in the interest of security and of the control process" no "viewings" are possible.
China to overtake India in overall gold demand: GFMS
China's gold demand is expected to grow 1 percent this year to a record of around 860 tonnes, the global head of metals at consultancy Thomson Reuters GFMS said on Thursday, with both jewellery and investment sales rising. That increase means China will overtake India as the world's biggest consumer of gold for the first time on a yearly basis, Philip Klapwijk told the online Reuters Global Gold Forum. "China will overtake India ... both in overall demand terms and as the world's largest jewellery market," he said.
Yesterday's top story: Obama re-election means ‘Perfect Storm' for gold - Nichols
The gold price reacted sharply upwards to President Obama's re-election, with the U.S. dollar initially falling, but then the dollar recovered as Europe's woes continue to depress alternative currencies and gold drifted back, before moving sharply upwards again in later trading despite the dollor index remaining up a little - which many would take as a very positive sign for gold and the other precious metals which rose along with it.
UPDATE 1-India's 2013 gold imports seen at 550 tonnes
"The demand (imports) for next year is expected to be about 550 tonnes (and) may drop further if there is an increase in customs duty," Mohit Kamboj, the newly elected president of the Bombay Bullion Association, told Reuters Gold Forum on Tuesday. He added that imports this year could be down by 42-45 percent from 2011 to around 532 tonnes.
Barrick now eclipsed by Goldcorp for title of largest market cap
Barrick Gold Corp. is by far the world’s largest gold producer. It has the most mines and the most reserves. Barrick is aiming to churn out 7.3 to 7.8 million ounces of gold this year, more than triple Goldcorp’s guidance (2.35 to 2.45 million). While Barrick plans to have a production base of at least eight million ounces by 2015, Goldcorp hopes to reach 4.2 million ounces by 2016, nearly double the current level. But (Barrick) is no longer No. 1 where it matters most. In recent days, Barrick has been eclipsed by Goldcorp Inc. for the title of largest market capitalization in the gold sector. It is an embarrassing development for Barrick, and comes shortly after the company went through a CEO change and reported massive cost escalation at its key growth project.
Gold Imports by China From Hong Kong Gain on Haven Demand
Gold imports by China from Hong Kong climbed 30 percent in September from a month earlier as mainland China bought 69,712 kilograms (69.71 metric tons), including scrap and coins, compared with 53,508 kilograms in August. Shipments were 23 percent more than the 56,896 kilograms a year earlier, data from the Census and Statistics Department of the Hong Kong government show.
192 Million Ounces of Paper Silver Dumped on Market in 10 Minutes On NFP Release!
According to NetDania’s volume (which approximates volume from 5 separate sources and is not an exact indicator of volume data) 38,400 contracts, or 191.99 million ounces of paper silver (nearly a quarter of annual global silver production!) were dumped on the market in only 10 minutes between 8:30 and 8:40am EST upon the release of the NFP data. Screen shot of the paper dump (with 3rd wave of attack in progress) below: [Read more...]
Kazakhstan National Bank's gold reserves increased by 30 percent
Share of gold in the gold and currency reserves of Kazakhstan's central bank has increased by 30 percent from the beginning of the year, Tengrinews.kz reports citing deputy chairman of Kazakhstan National Bank Bissengali Tadzhiyakov as saying at the plenary meeting of Majilis (lower chamber of the Parliament). "Starting from the beginning of this year international reserves of the country, including the foreign currency reserves of the National Fund, have increased by 17.2 percent and made $80.5 billion.
Market Nuggets: U.S. Mint Oct., Silver-, Gold-Coin Sales Dip From September; Up Year-On-Year
U.S. Mint Oct., Silver-, Gold-Coin Sales Dip From September; Up Year-On-Year U.S. Mint sales of American Eagle bullion gold and silver coins fell in October from September but were up from the same month a year ago, according to data on the agency's Web site. Gold-coin sales totaled 59,000 ounces last month, down from 68,500 in September but up from 50,000 in October 2011. Year-do-date sales are 540,500, compared to 893,500 in the first 10 months of 2011. Meanwhile, silver-coin sales were 3,153,000 ounces in October. This was down from 3,255,000 in September but up from 3,064,000 in October 2011. Year-to-date silver-coin sales of 28,948,000 ounces are down from 36,475,500 from the same time frame in 2011.
Ecuador Demands Repatriation of 1/3 of Gold Reserves
Over the weekend we stated the gold repatriation avalanche had begun with a Netherlands citizens group joining the German Federal Accountability Office in demanding the BOE and NY Fed return their nation’s gold reserves. We predicted that an avalanche of nations across the West would soon join Germany and Venezuela in attempting to repatriate their tungsten gold reserves from the Fed and the BOE, and it appears that avalanche is picking up momentum as Ecuador, with 26.3 tons of gold reserves, has just demanded the repatriation of one third of their foreign gold holdings ‘to support national growth‘.
Gold Supply Issues Offer Additional Price Underpinnings
First of all, and this is a topic we've discussed on numerous occasions, none of the mining supply from China is making it to the open market. Essentially, every ounce of gold mined in the world's largest producer is going right to their insatiable reserve building effort. Secondly, James Rickards, a partner at JAC Capital Advisors, suggested via Twitter last week that the primary takeaway from the Sydney Gold Symposium was that the "Chinese are buying gold mines in Western Australia faster than lawyers can write the contracts." It would seem that the Chinese have their eyes on some of the output from the world's second largest producer of gold as well. Thirdly, the fourth largest producer in the world is also in full-on accumulation mode. The World Gold Council says Russia has more than doubled its gold reserves in the last five years and now holds the fifth largest stockpile. It is likely that much - if not all - of their mining output is going right to reserves as well. And finally, labor unrest in South Africa has negatively impacted production in the fifth largest producing nation. Earlier in the month, Reuters reported that strikes were costing AngloGold 32,000 ounces of gold each week, while Gold Fields was losing 2,300 ounces a day at the two mines affected.
Platinum demand to rise 50% in India
Growing popularity and awareness among consumers are set to drive platinum demand by 50% in India for the next couple of years. Moreso, aspiring customers' desire for a change from the perennial gold with higher possibility of returns on their investment is likely to pull platinum demand in India. Jewellers believe India's platinum demand today at around 15 tonnes. But, its popularity is increasing day - by - day as the metal is considered as rare with estimated returns higher than gold. Since, platinum price has been sustainable lower than gold for the last over two years, its price may surpass gold soon which holds higher possibility of returns. "This is in the initial growth stage so we expect demand to grow over the next few years. We are looking at an overall 40 - 50% growth with some part from organic growth and other from market expansion for the coming season," said Vaishali Banerjee, Country Manager India, Platinum Guild International (PGI).
Hedge Funds Returning to Palladium as ETPs Retreat: Commodities
Hedge funds are siding with analysts predicting decade-high palladium prices even as investors cut holdings in exchange-traded products backed by this year’s worst-performing precious metal. The funds’ wagers on a rally more than doubled since August as ETP holdings slumped to a seven-month low this month, data compiled by Bloomberg show. Prices for the metal used mostly in catalytic converters will average $800 an ounce in the third quarter, 34 percent more than now and the highest since 2001, based on the median of 13 analyst estimates.
Gold price looking to close the week flat a UK Royal Mint runs out of sovereigns
We got this interesting note form the UK mint this week:
2012 BULLION SOVEREIGN - SOLD OUT
Dear Customer, Thank you for your continued support of our bullion range and we are pleased to confirm that the 2012 Bullion Sovereign is now SOLD OUT. For reference our 2013 Bullion Sovereign is now available to purchase, with deliveries from Monday 5th November 2012. Please find attached product information and pricing. If we can be of any further assistance please contact us on the details below. Best regards The Royal Mint Bullion Team That's right the UK mint has sold out of sovereigns. After speaking with them it turns out that a couple of recent big order have cleaned them out of their remaining stock. It has also apparently been their best year for sovereign sales.All this does is underline that UK demand has been very strong this year and in particular gold sovereigns. So why are people turning to sovereigns in the UK? Very simple, they are capital gains tax free, which many people don't realise.
DJ Vietnam May Allow Banks to Buy 20 Tons of Gold in Next Two Months
HANOI--The State Bank of Vietnam, the country's central bank, may allow local banks to buy up to 20 metric tons of gold over the next two months to improve their liquidity ahead of a ban soon on their use of gold as a means of boosting their operating capital, a senior central bank official said in a statement issued Friday. Banks have bought more than 60 tons of gold during the past six months and still need to buy more to meet their liquidity needs, Deputy Central Bank Governor Le Minh Hung said in the statement, posted on the central bank's website.
Gold Traders More Bullish as ETP Hoard Sets Record: Commodities
Gold traders are the most bullish inthree weeks as investors' bullion holdings rose to a record onmounting speculation that central banks will add stimulus tobolster economic growth.Fourteen of 26 analysts surveyed by Bloomberg expect pricesto rise next week, nine were bearish and three were neutral.Investors boosted holdings in exchange-traded products to anall-time high of 2,585.1 metric tons yesterday, valued at $141.5 billion, data compiled by Bloomberg show.
Bundesbank Says NY Fed to Help Meet Gold Audit Request
“We have been in discussions with the Federal Reserve Bank of New York about the Bundesbank’s holdings of gold,” the Bundesbank said yesterday in a letter to the German parliament’s budget committee. “The discussions have been fruitful and the Federal Reserve has expressed a commitment to work with the Bundesbank to explore ways to address the audit observations, consistent with its own security and control processes and logistical constraints.” “We’re in negotiations with our partner central banks to develop auditing rights, and that’s been agreed in principle,” said Thiele. “In parallel, we will, over the next three years, transfer 50 tons of gold each year from New York to Frankfurt, which is an additional way to create confidence.
Brazil’s Gold Reserves Rise For First Time Since 2008
Brazil’s holdings expanded 1.7 tons last month to 35.3 tons, data on the International Monetary Fund’s website showed. Turkey’s holdings increased 6.8 tons and Ukraine added 0.3 ton. “If a central bank like Brazil decides to enter the gold market, it will keep buying for a longer time horizon until an optimal share of gold holdings to total asset is reached,” said Bayram Dincer, an analyst at LGT Capital Management in Pfaeffikon, Switzerland. “This constant demand is price supportive.”
China Silver Demand to Climb to Record
Silver demand in China, the world’s second-largest user, is set to jump as much as 10 percent next year to a record as investors look to preserve wealth, according to Beijing Antaike Information Development Co. Consumption may climb to 7,700 metric tons after gaining 6 percent to 8 percent in 2012, Shi Heqing, an analyst at Beijing Antaike, said in an interview on Oct. 22. About 33 percent of the country’s demand comes from jewelry and coins, with the rest from industrial use in photography, solar and electrical appliances, according to Antaike, which has studied metals for two decades. “Chinese investors want hard assets such as silver, especially when it’s cheaper than gold and requires less funding,” Shi said. “Many producers and investors have hoarded the precious metal in the form of ingots or unwrought silver.”
Gold, silver momentum building - Charles Oliver
Sprott's Charles Oliver says it's a great time to be heading up a precious metals fund. Gold and silver companies are trading at spectacular valuations, quantitative easings by the governments of the world are poised to strengthen the metals' prices even further, and more bargains could be had soon if investors dump stocks to avoid taxes.
Bundesbank slashed London gold holdings in mystery move
Germany withdrew two thirds of its vast holdings of gold from Bank of England vaults shortly after the launch of the euro more than a decade ago, according to a confidential report by German auditors.
Unease about Germany's unchecked gold reserves
The central bank must renegotiate its contracts to gain the right to inspect its gold bars, which are worth tens of billions of dollars and are stored in the United States, Britain and France, the Federal Auditors’ Office said in a report to lawmakers obtained by The Associated Press on Monday. The report says the gold bars ‘‘have never been physically checked by the Bundesbank itself or other independent auditors regarding their authenticity or weight.’’ Instead, it relies on a ‘‘written confirmations by the storage sites.’’ Most of Germany’s gold reserves — some 3,400 tons... have been kept in the vaults of the U.S. Federal Reserve, the Bank of France and the Bank of England since the postwar days.
Japan to join currency wars as exports slump
Japan is poised to join the world's "currency wars" as it battles a triple crisis of crashing exports, recession and a suffocatingly-strong yen. Hans Redeker from Morgan Stanley says this pattern may soon change as political upheaval in Tokyo and surging public debt of 245pc of GDP usher in an era of devaluation. Redeker said the yen has been kept strong by Japanese insurers and pension funds hedging their $1.8 trillion holdings of foreign bonds with currency swaps. They are now fully hedged. This pillar of support has been knocked away.
Gold ETFs vs equities, Goldman Sachs surveys the battleground
"I think the gold seniors are aware that the return to shareholders is among the key criteria. All of them were talking about it in Denver. Whether the return takes the form of a payout ratio or a percentage of the payout ratio or free cash flow or is tied to the gold price, the majors got the message loud and clear that they have to do more than rely on the gold price to see share price appreciation and shareholder returns." ... To be more attractive to investors than the ETF, the gold seniors also must grow EPS. Increasing volume when gold prices increase accelerates EPS growth, but volume growth must drive EPS growth-not simply higher gold prices. With volume-driven EPS growth, improving gold prices also give investors more leverage to gold than they would have in an ETF. And I think perhaps we're starting to see recovery in the gold equities. But it all starts out with meeting the guidance they give the market. -Ian Preston is a resources analyst for Goldman Sachs' Global Investment Research in Australia and New Zealand.
Chinese Gold Imports Through August Surpass Total ECB Holdings, Imports From Australia Surge 900%
First it was more than the UK. Then more than Portugal. Then a month ago we said that as of September, "it is now safe to say that in 2012 alone China has imported more gold than the ECB's entire official 502.1 tons of holdings." Sure enough, according to the latest release from the Hong Kong Census and Statistics Department, through the end of August, China had imported a whopping gross 512 tons of gold, 10 tons more than the latest official ECB gold holdings. We can now safely say that as of today, China will have imported more gold than the 11th largest official holder of gold, India, with 558 tons.
Embry - London Trader, Commercials & A Spike In Gold
Today John Embry told King World News, “What the London Trader was discussing with you was the fact that we were within $10 of a commercial signal failure, which is just astonishing.” Embry also stated, “These commercials are incredibly short ... So if this market starts going against them, the price rise will be extraordinary.” Here is what Embry, who is chief investment strategist at Sprott Asset Management, had to say: “Im focused on two things in the short-term. I’m not too concerned with the fact that gold is being knocked around here. There are two factors at work. One, and the ‘London Trader’ spoke so eloquently of it in your interviews with that source, is this massive short position by the bullion banks.”
Gold Imports by India Seen Climbing First Time in Six Quarters
Indian gold imports to climb for the first time in six quarters Gold imports by India, the world's largest buyer, are set to climb for the first time in six quarters as a decline in domestic bullion prices stokes jewelry and investment demand ahead of major festivals. Overseas purchases may jump to as much as 200 metric tons this quarter, said Bachhraj Bamalwa, chairman of the All India Gems & Jewellery Trade Federation. That compares with the 157 tons in the fourth quarter of 2011, according to World Gold Council data. Purchases in the quarter ended September probably fell to as low as 170 tons from 205 tons a year earlier, Bamalwa said. The council is yet to release data for the third quarter.
Mining industry outlook ‘vastly improved' in October - CEO Survey
A survey of 125 mining executives internationally reveals that the outlook for the mining industry "has vastly improved" in the last four months, says Andrew Pollard, president of Vancouver's Mining Recruitment Group Ltd. "2012 has been a year of tremendous volatility for the industry, felt by resources companies across all stages, from the junior explorers up to the large cap producers," Mining Recruitment Group (MRG) observed."Thankfully, this new report provides evidence that the worst may in fact already be behind us."
5 MILLION OUNCES of REGISTERED Silver Withdrawn From Brink’s Since Friday!
Last Friday we updated readers of an astonishing 3.6 million ounce REGISTERED silver withdrawal from Brink's COMEX vaults. The physical silver drain continued Tuesday, as a massive 1.2 million additional REGISTERED ounces were withdrawn- again from Brink's vaults!! This brings the total to nearly 5 million ounces of REGISTERED silver withdrawn from a SINGLE COMEX DEPOSITORY in the span of 3 days! This is approximately 25% of Brink's entire REGISTERED inventory, and 12% of the entire COMEX REGISTERED SILVER INVENTORY!!!
Gold demand up by 10% in India in October
KOLKATA: A drop in local gold prices to a three-week low has prompted a wave of buying in India from the beginning of this week, that marks the end of inauspicious shradh paksh. Bullion dealers and jewellers are stocking gold at this price for the upcoming festive season. Gold traders say that in October there has been an increase in demand by 10% compared to the previous month which may go up further if there is a correction in prices going ahead. Mohit Kamboj, president of Bombay Bullion Association, said: "In the quarter July-September, India had imported 157 tonnes of gold. We are expecting an import figure of 250 tonnes in the quarter October- December on account of festive season and wedding demand. A fall in prices will be advantageous for the trade."
Gold as an Investment: The Infographic
Following last week’s Silver is the New Gold infographic detailing all the supply/demand data and statistics a silver bug could imagine, Visual Capitalist has released the ultimate infographic on gold as an investment. While it’s not silver, gold is our next favorite investment.
Silver is the New Gold: The Infographic
You’ve seen the infographics on total US debt, the TARP bailout, and the TBTF banks’ derivative holdings, but until now you’ve never seen an infographic detailing in vivid detail exactly why the world is running out of silver. The infographic details silver’s supply/demand fundamentals propelling the metal to nearly 700% returns since 2000, and looks at whats to come on the PHYSICAL supply/demand over the next decade.
The U.S. Suffers a Huge Gold Deficit As Record Amounts Are Exported To Switzerland, London, and Hong Kong
In a stunning development over the first seven months of the year, the United States has run up a huge gold deficit as it has exported a record 424 metric tonnes of gold. This is indeed a significant amount when the U.S. exported a total of 488 metric tonnes for the entire year in 2011.According to the USGS July Gold Mineral Industry Survey, the U.S. only imported 188 metric tonnes of gold between Jan-Jul, but exported 424 metric tonnes leaving a huge shortfall. Some of this deficit was made up by the U.S. domestic gold mine supply.However, if we add up all the domestic gold mine supply plus the gold imports in the first seven months of 2012, the United States still ran a large 102 metric tonne gold account deficit. Just to make sure I don't cause any confusion, these figures are based on the USGS statistics of gold import-exports of the following categories:1) ores & concentrates2) dore & precipitates3) refined bullion
Gold Fields Mine Threatens To Sack Strikers
Mining giant Gold Fields issues an ultimatum to two-thirds of its workforce, as violence continues in strike-ridden South Africa. South African bullion producer Gold Fields, the world's fourth largest gold miner, has been among the companies facing union demands for better wages.Disruption to output at its mines in the country has so far cost it 65,000 ounces of lost gold production worth almost £85m. Chief executive Nick Holland said: "The company has issued an ultimatum to all striking workers... to present to work by no later than 1400 hours Thursday 18 October 2012 or face immediate dismissal."
The Aboveground Gold Stock: Its Importance and Its Size
What if the world's stock of aboveground gold was actually smaller than is generally believed to be the case? What would be the implications in terms of common statistics cited in analysis of the gold market? In this essay, James Turk examines why there are solid reasons for believing that many gold authorities overstate the aboveground stock of the metal. According to the World Gold Council, which is using Thomson Reuters data, the world's gold stock as of December 2011 was 171,300 tonnes. Our research provides a reasonable analytical framework to suggest that the gold stock as of December 2011 is 155,244 tonnes, meaning that Thomson Reuters GFMS overestimates the existing stock by 16,056 tonnes, or 10.3%. Given that data provided by the World Gold Council is usually taken as the principal reference on this matter, we conclude that a general perception exists which overstates the current gold stock. The amount of the overstatement is more than five-times annual production, and at the current price of $1,700 per ounce has a nominal value of $877 billion.
S. Africa Gold Strike Talks Fail With 50% of Output Shut
Africa's largest gold producers willpursue legal remedies instead of continuing talks with unionsafter South African strikes widened, idling half of the nation'soutput of the metal, the Solidarity union said. AngloGold Ashanti Ltd., Gold Fields Ltd. and Harmony Gold Mining Co. will "look at a new negotiating model once order andstability is restored," and won't raise an earlier offer toworkers, Gideon du Plessis, the head of Solidarity, said bymobile phone today. Workers resumed an unauthorized strike at the East section of Gold Fields' Kloof-Driefontein Complex late yesterday, the company said. Production at the entire complex, Africa's largest gold mining operation, has now been suspended as about 19,500 of the complex's 26,700 workers are on strike, it said.
ECB's Weidmann On Gold: "Money Is A Social Convention"
A few weeks ago we noted Bundesbank president and ECB governing council member Jens Weidmann's analogy between the Faustian bargain offered by a money-printing Mephistopheles in Goethe's classic prose and today's ubiquitous oh-so-tempting short-term solution to everyone's pain. His full speech (below), while a little dramatic, should indeed strike fear into many with its clarity. The financial power of a central bank is unlimited in principle; it does not have to acquire beforehand the money it lends or uses for payments. Many believe Goethe was portraying the modern economy with its creation of paper money as a continuation of alchemy by other means. While traditional alchemists attempted to turn lead into gold, in the modern economy, paper was made into money.
Ben’s gold touch
Ben Bernanke’s move in early July to begin a third round of quantitative easing, or so-called QE3, has done little for economic growth, according to latest figures, but it has benefited gold, silver and oil trading by cheapening the dollar, analysts say.“The dollar is selling off compared to gold because of the market’s belief that the recent round of QE3 is going to cause a weaker dollar with investors bidding up gold prices,” Mark Martiak, senior wealth strategist at New York-based Premier Financial Advisors, told The Post.And it’s not just gold. Since the Fed chief announced the latest round, unleashing $40 billion a month to purchase mortgage bonds, the greenback has depreciated 10 percent against the euro.Gold has risen 13 percent, and silver has soared 26 percent, while crude oil rose 9.5 percent.And if you expand your time horizon out to when the Fed began its easing operation in November 2008, gold has risen 148 percent, or more than $1,000 an ounce, as the Fed has added over $1.9 trillion to its balance sheet.
MASSIVE COMEX SILVER WITHDRAWAL ON FRIDAY- 3.6 MILLION OUNCES WITHDRAWN FROM BRINKS!
There was a massive silver withdrawal out of the Comex on Friday. Over the past week, there has been a steady increase in the total amount of silver in the Comex warehouses.However, in one huge withdrawal, 3.6 MILLION OUNCES, a whopping 17% of Brinks total REGISTERED silver inventory was removed on Friday. I have not seen such a large withdrawal from the registered category for quite some time.Furthermore, this single withdrawal from the Brinks registered category was nearly 10% of all the total registered silver in the Comex warehouses.
Embry - This War In Gold & Shorts Getting Overrun
“This is one of those moments in the gold market where there is a distinct possibility that we will see a commercial signal failure. A commercial signal failure is an extremely rare event, but we could well be setting up for just such an occurrence right now.”
The Bank of England covers 50% of all newly issued debt and will hit its £375bn QE target by the end of October – Here’s why they print more
The most recent Debt Management Office numbers have the BoE now owning through the APF more than 27% of ALL the UK gilts outstanding. Here is the total issuance up to March 30th 2012:total bonds issued march 2012 The Bank of England covers 50% of all newly issued debt and will hit its £375bn QE target by the end of October Heres why they print more. And since March 30th the UK has issued another £99.4bn. So today the total bonds outstanding in the UK stands at £1340bn. Of which the BoE owns some £365bn or 27%.total gilts to date 2012 a The Bank of England covers 50% of all newly issued debt and will hit its £375bn QE target by the end of October Heres why they print more(click for sharper image) The Bank of England covers 50% of all newly issued debt and will hit its £375bn QE target by the end of October Heres why they print more (click for sharper image)Since 1987 the increase in bonds has been 850%, but when you subtract the BoE’s bond holdings that total is ‘only’ 600%.But more worryingly than the total 27% ownership that the BoE now has, it is the amount of new issuance covered that is much higher. Since the BoE started buying up UK debt at the beginning of 2009 the UK has issued about £724bn in new debt. Over that time period the BoE has bought up £365bn. Which means that a staggering 50% on ALL newly issued UK debt has been covered by the BoE.
Striking South African gold miners reject pay offer
Striking gold miners in South Africa have rejected the industry's latest wage offer, a trade union said on Thursday, dimming hopes that strikes that have led to dozens of deaths and paralyzed the sector could end soon.
U.S. mined silver output down 12% in July 2012 - U.S. Geological Survey
The U.S.G.S. ... reported U.S. mines produced 80,500 kilograms (2,588,140 oz.) of silver in July, a 12% decrease compared to July 2011. For the period from January to July, U.S. mines reported 579,000 kg (18,615,300 oz.) of silver production with 130,000 kg (4.18 million oz.) coming from Nevada mines.
Inflows to gold exchange-traded products surge
Exchange-traded funds tracked by Commerzbank have increased their holdings by 13 metric tons over the past two days, and 191 metric tons of gold have flowed into related ETFs since the end of July, the bank said. Meanwhile, inflows to gold exchange-traded products — which include notes and funds — reached $7.7 billion in the third quarter of 2012, the best performing quarter for gold ETP inflows since the second quarter of 2010, according to ETF Securities. Currently, assets under management at gold ETPs stand at an all-time high of $151 billion, added Rhind.
World's richest man Carlos Slim bets on Mexican gold mining
Little more than a month after AuRico Gold announced the Ocampo mine would lose at least 40,000 to 45,000 ounces of gold equivalent production... Billionaire Slim's third-largest holding, Frisco--spun off last year from his holding company Grupo Carso SAB--will acquire Ocampo, the exploration projects Venus and Los Jarros, all located in the Chihuahua State and a 50% interested in AuRico's Orion advanced development project in Nayarit State, Mexico, for a total cash consideration of $750 million.
S.Africa gold mine owners, unions reach pay deal
South Africa's gold mine owners and unions representing picketing workers said Wednesday they had reached a deal to end months of industrial unrest that has curbed production of the precious metal. The Chamber of Mines and the National Union of Mineworkers (NUM) agreed to a series of pay rises that will now be put to striking workers for approval begining Wednesday. The deal will include a pay increase for entry-level workers, and an "allowance" for rock drill and other operators.
Rule: We Have Tight Gold Supplies & Future Supply Constraints
“We are hearing about very strong retail demand for gold. The retail supplies would appear to be tight, even though the larger, 400 ounce bars are still available. And it looks as though retail demand is really strong on a global basis. Indian demand has also picked up as a result of the Indian government easing their restrictions and taxes. Retail demand in the Western world is also strong. Most importantly, there appears to be continued interest from the Chinese government in expanding the retail gold market. "
Gold is not a commodity but the strongest currency of all
While gold bugs have long been aware that gold is, and always has been, a monetary metal many others in the investment community have, in the past, continued to feel otherwise and valued it accordingly as just another commodity. But this perception is changing as recent events, and price movements, have emphasised that the gold price moves are currently being dictated more by global economic and political factors than by normal commodity economics of supply and demand.
Do Western Central Banks Have Any Gold Left???
Somewhere deep in the bowels of the world’s Western central banks lie vaults holding gargantuan piles of physical gold bars… or at least that’s what they all claim. The gold bars are part of their respective foreign currency reserves, which include all the usual fiat currencies like the dollar, the pound, the yen and the euro. Collectively, the governments/central banks of the United States, United Kingdom, Japan, Switzerland, Eurozone and the International Monetary Fund (IMF) are believed to hold an impressive 23,349 tonnes of gold in their respective reserves, representing more than $1.3 trillion at today’s gold price. Beyond the suggested tonnage, however, very little is actually known about the gold that makes up this massive stockpile. Western central banks disclose next to nothing about where it’s stored, in what form, or how much of the gold reserves are utilized for other purposes. We are assured that it’s all there, of course, but little effort has ever been made by the central banks to provide any details beyond the arbitrary references in their various financial reserve reports.
Gold ETF Bullion Holdings at Record After $3B Monthly Inflow
The largest gold ETFs listed in the U.S. have attracted about $3 billion of inflows the past month, pushing the amount of bullion in metal-backed products to fresh highs.Investors are flooding into gold ETFs on fears the latest round of central bank easing will debase global currencies and stoke inflation.The amount of gold held in bullion-backed exchange traded products stands at about 2,554 metric tons, a new record, according to Bloomberg.
Gold hits 11-month high after ECB; $1,800 in sight
NEW YORK (Reuters) - Gold rose to its highest price in 11 months on Thursday, with the market's sights set firmly on $1,800 an ounce, as the inflation-hedge appeal of bullion was bolstered by signs the European Central Bank intends to keep borrowing costs low.
Gold bears head for the hills
“While the odds of picking a market bottom are undoubtedly poor, it seems likely to us that August might well have been a turning point for gold equities,” Ron Stewart said Wednesday. Gold bullion and equities have moved “dramatically higher” after the Aug. 23rd release of the minutes of the U.S. Federal Open Market Committee (FOMC) meeting that took place some three weeks earlier, and indicated another round of quantitative easing [bond-buying program] was imminent, he wrote. The trend of gold outperforming equities was likely broken by events in August, and “signals the possibility of a change in market sentiment towards gold companies, which were previously stuck in a secular bear market when compared to the bullion price since 2006,” Mr. Stewart wrote in a report. While acknowledging that the price increase in the gold securities may not be sustainable in the short term, he expect many of the equities in the Dundee coverage universe will “take out their 52-week highs” over the next year.
What South Africa Means To The Platinum Market (PGM, PPLT, PTM, LPLT, EZA)
Labor problems are not the only problems facing South Africa's platinum industry. Other problems include a volatile South African rand, a slowdown in Europe's vehicle market, relatively low platinum prices and rapidly rising costs. In addition to labor costs, South Africa platinum producers are facing skyrocketing costs for electricity (the mining is very power intensive), which has been climbing at a 25% annual rate for the past three years. Most in the industry do not see these problems going away anytime soon in the country. Russia' Norilsk, one of the few major platinum producer outside South Africa, believes South Africa's production will decline between 350,000 and 400,000 ounces this year. There is a surplus of platinum right now - 6.5% of total demand - and it may take 12 to 18 months of continued problems in South Africa to clear that surplus. But after that, the industry could be in a period of supply deficits for years to come.
Look Out Silver, Here Comes Solar Demand
In early July, Japan set a premium price for solar energy that was three times the rate of conventional power. This meant utility companies would be paid three times more for electricity sourced from solar. It's widely expected that the premium will ignite the use of solar power - and solar uses a lot of silver. In their 2012 Yearbook, CPM projected a slight decline in silver demand from solar panels due to a reduction of new installation in Europe and oversupply from excess production in China. But with the initiative from Japan, that estimate is almost certainly low. Here's what that amount of money would do to the sector: There were approximately1.3 gigawatts of solar capacity installed in 2011, but experts anticipate that number to nearly double to 2.3-2.5GW for 2012, and hit 3.0GW in 2013. According to SolarBuzz, Japan could see 28GW of solar capacity installed by 2020 and 50GW by 2030. The bottom line on the above is that the growing number of industrial applications for silver represents a long-term shift in this market. Increasingly diverse usage is not only here to stay but will continue to grow, supporting the price and impacting the balance of supply and demand.
Gold Jumps to 10-Month High on U.S. Stimulus Speculation
(Bloomberg) -- Gold futures jumped to a 10-monthhigh after Federal Reserve Bank of Chicago President CharlesEvans said that the U.S. central bank can do more to boost theeconomy, fueling concern that inflation will accelerate. Evans, who doesn't vote on Fed policy this year, said todayin an interview on CNBC that unemployment probably won't fall to7 percent until 2014. The central bank can "back off" of itsaccommodation should inflation present a greater threat, he said.
India unlocks treasure trove of gold as farmers sell
"We have no other option but to sell our gold in these tough times," said Karanure, speaking from her village in Chikkodi in Karnataka.She could get nearly 150,000 rupees from the sale of her bangles and necklaces, a vital source of income after drought this year has slashed rural incomes.The Bombay Bullion Association (BBA) estimates the supply of recycled gold in India will hit 300 tonnes in 2012, up about five-fold from 2011 and the highest in more than a decade. "There won't be new demand from farmers and scrap will flow in the market," said Prithviraj Kothari, president of the BBA, made up of 400 bullion dealers and traders. "In coming years, 50 percent of the requirements will be met through scrap." India's scrap market in 2011 was only 58.5 tonnes, or 6 percent of total gold demand of 969 tonnes, but it is being boosted as consumers baulk against paying a 4 percent import tax and with the local price of gold near a record high of 32,421 rupees per 10 grams.Farmers in India are the biggest buyers of gold which they use as savings in the absence of a functional bank network. This year, because of a drought in parts of the country, they are having to cash in gold to pay off loans taken out to purchase fertiliser and seeds, which have in many areas failed to produce a crop.
Barclays opens new London gold vault
The first British bank-owned gold vault to open in over five years, Barclays is expecting demand for space from pension funds, central banks and sovereign wealth funds.In keeping with the opacity that shrouds the vaulting industry, Barclays did not specify how large their new facility is. The Bank of England, the world's fifteenth largest custodian of gold reserves, houses some 310 tonnes in its underground vault below the streets of the City of London.Precious metals storage has shaken off its dusty image, emerging as a lucrative business.
24 hour $US Dollar price per ounce
24 hour $US Dollar price per ounce