Author Topic: COULD A GOLDEN ROUBLE CATALYSE A GLOBAL REMONETISATION OF GOLD?  (Read 5402 times)

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COULD A GOLDEN ROUBLE CATALYSE A GLOBAL REMONETISATION OF GOLD?
« on: November 23, 2014, 08:04:33 PM »
COULD A GOLDEN ROUBLE CATALYSE A GLOBAL REMONETISATION OF GOLD?

There is another aspect to consider, however, which is the possible impact this policy would have on the dollar and the international monetary system. Recall that, as the primary global reserve currency, the dollar circulates in vast quantities abroad, where it forms the bulk of the monetary reserves of central banks. This is in part what allows the US government and economy generally to finance themselves at such low interest rates. But other factors equal, if the dollar suddenly faces competition from a credible, gold-backed currency, it is likely that, at a minimum, central banks are likely to diversify at least some of their dollar reserves into interest-bearing, gold-backed roubles. Countries importing oil from Russia would have an additional incentive to do so as they would be able to pay for Russian oil imports in roubles and avoid sanctions. Speculators (or investors) anticipating an eventual internationalisation of the rouble would front-run these developments, pocketing a nice return over time.

The implied upward pressure on US interest rates would be perhaps small initially, but even a small rise in US interest rates would spell trouble for a US economy that is so highly leveraged to low rates. Growth would slow. The Fed could try to offset this by engaging in renewed QE, but that could add fuel to the fire, resulting in aggressive selling of dollars in the foreign exchange markets. In an extreme but hardly impossible scenario, the dollar could lose reserve status entirely, something that would be devastating for the US economy. While a sharply weaker dollar would help US competitiveness and exports over time, it would crush the dollar’s effective international purchasing power (eg for oil and other resources) and result in soaring consumer price inflation. The combined negative impact of higher interest rates on growth and rising consumer prices on inflation would make the stagflationary 1970s look like a picnic.

As I argue in my book, THE GOLDEN REVOLUTION, a loss of reserve status for the dollar would have vast repercussions for the international monetary system.[9] While a gold-backed rouble could challenge the dollar to a certain extent, it is unrealistic to think that an economy the size of Russia’s could back the dominant global reserve currency. No, as the dollar’s share declines, most probably multiple alternative currencies begin to serve as reserves. This is where things get interesting, however. Other factors equal, as a currency is used as a reserve, it strengthens that currency. That might be unwelcome in some economies heavily geared toward exports.

Thus dethroning the dollar does not end the currency wars but rather could escalate them further instead as one country after another tried to offset dollar weakness by weakening their own currencies. This sort of ‘race to the bottom’ was seen in the 1920s and 1930s, culminating in US President Roosevelt’s executive decision to devalue the dollar by some 60% in 1934. In that instance, however, the dollar remained backed by gold and by what was by far the largest global economy at that time.

Not so today. The global economy has become increasingly multipolar, with both the euro-area and China roughly as large as the US. Moreover, the US has a huge accumulated and external debt, implying a growing risk of debasement and devaluation in future. As it stands today, only 2.3% of the narrow US money supply is backed by gold. Thus the US is simply no longer in a position to be a ‘monetary hegemon’, providing the global reserve currency.

But as all large economies have their own debt or other financial issues with which to deal, no major currency is in a position to replace the dollar as the pre-eminent reserve. This implies that the global monetary system is highly unstable. The dollar is hardly the only currency at risk of debasement and devaluation. Game theory implies that a race to the bottom is distinct possibility and it is unclear whether the dollar would lead or follow in that race.

As I further argue in my book, this combination of economic multipolarity and the instability of the current global monetary equilibrium is highly likely to result in at least a partial if not full remonetisation of gold, with an associated, large rise in price. Gold is the ideal way for countries to settle their trade imbalances in a world in which trust in currency stability is lacking. Accumulating reserves that can be summarily devalued by trading partners in a currency war is not a rational policy. Yet something must function as a reserve asset if trade is to take place at all. Gold provides that ‘something’ as supply is stable and it cannot be arbitrarily devalued. Backing currencies by gold would thus greatly increase trust and, thereby, facilitate international trade.

Those familiar with the 1870s will note that there are now strong parallels with that important decade. Following German unification and the US recovery from the Civil War, both of these economies were catching up rapidly with Britain. Japan had begun to industrialise. Under these multipolar conditions arose spontaneously, absent formal diplomacy, the classical gold standard system that would underpin decades of arguably the fastest sustained global economic growth ever experienced in history.[10]

 

SO, WILL PUTIN PLAY THE ‘GOLD CARD’?

Let’s now return to Russia and leave aside a biased western perspective for the moment. Putin has arguably accomplished more for Russia than has any other contemporary leader of a major country. Yes, he may be something of an autocrat, but please show me one major developed country that has never been ruled by an autocrat. (The USA began its life under George III and borrowed the bulk of its legal code and political culture from the UK.) Under Putin’s leadership, Russia has maintained its territorial integrity, something that had been left in question following the collapse of the Soviet Union, and Russia retains a formidable military capable of defending its vast frontiers (although not capable of policing the world). The economy has grown rapidly and, while still resource-dependent, has begun to diversify in various ways. (Keep in mind the young USA was regarded by Europeans as a largely resource-dependent economy.) Russia has built strong economic and political ties not only with the BRICS but also many smaller economies in Eurasia and elsewhere around the world. Russia has only a small accumulated national debt, implying that this will not be a drag on future growth, as is likely to be the case in the US, EU and Japan. Russia also has an advantageous tax system, with a top 13% rate of income tax. Yes, Russia remains an economically unequal society, but we know what has happened to inequality throughout the developed economies in recent decades, not just following the 2008 global financial crisis.

Given these achievements, Putin is not a leader to be taken lightly and we should pay attention when he says it it his desire to end the ‘dictatorship of the dollar’, as he did just this week. [11] Perhaps he will indeed play the gold card he has hidden up his sleeve and thus kill two birds with one stone: shore up the rouble and Russian economy on the one hand; dethrone the dollar on the other. A period of international monetary and associated economic chaos might ensue, but with Russia suffering already under unwelcome sanctions and thus with relatively less to lose, Putin might calculate that now is the time to make his move. He may have already achieved his place in the Russian history books but imagine how he will be regarded in world history books if he sets in motion that which culminates ultimately in the return to some form of global gold standard.
"Price is the most important factor to use in relation to value."  - Walter Schloss

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Gold rebound coming in 2015: George Gero
« Reply #1 on: November 26, 2014, 08:22:49 AM »
It hasn't been a great couple of years to be a gold bug. Since peaking at $1,923.70 per troy ounce in September 2011, gold has lost nearly 40 percent of its value. And while gold hasn't dropped dramatically this year, it has failed to gain back.

But according to George Gero of RBC Capital Markets, the bullion trade is set to turn around in 2015.

"The decline from the $1,900s down to the $1,150s is a major decline, and it was reflected by all the funds fleeing gold and running into better-performing assets, whether it's equities or debt, and that's been continuing," Gero said Tuesday on CNBC's "Futures Now."

In 2014, gold hasn't been helped by the dollar's rally. The greenback has shown serious strength against other currencies, which has reduced gold's attractiveness. After all, since gold is priced in dollars, an increase in the value of a dollar means a decrease in the value of an ounce of gold. Additionally, since people buy gold to hedge against potential inflation, ebbing inflation fears dull gold's appeal.

Gero acknowledges that "crude selling off, and OPEC possibly doing nothing about it, helping crude stay weak, is anti-inflationary—so the people that have been looking for inflation haven't really found it."

But he adds that "now you're going to see some changes based on all the stimulus in Europe, in China and in Japan."

So how high could gold go?
"I'm looking at $1,300 to $1,400 as a closing price one year from now," he said.

Back in December 2013, Gero predicted that gold was set to rise above $1,300 in the first quarter of 2014—a call that played out nicely as gold approached $1,400 toward the end of March.
"Price is the most important factor to use in relation to value."  - Walter Schloss

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Re: COULD A GOLDEN ROUBLE CATALYSE A GLOBAL REMONETISATION OF GOLD?
« Reply #2 on: November 26, 2014, 08:26:32 AM »



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Shanghai Gold Trade Passes Record as China Seeks More Sway
« Reply #3 on: December 03, 2014, 09:24:42 PM »
Shanghai Gold Trade Passes Record as China Seeks More Sway

Gold trading on China’s largest physical bullion bourse is already exceeding last year’s record volume as the world’s biggest consumer seeks to exert its influence on the global market.

The volume of all contracts on the Shanghai Gold Exchange, including those in the city’s free-trade zone, was 12,077 metric tons in the 10 months to October, compared with 11,614 tons during all of 2013, according to data on the bourse’s website. This may climb to 17,000 tons by the end of the year, the exchange’s Chairman Xu Luode said at a conference today.

China overtook India as the world’s largest gold user last year while European consumption shrank amid a global flow of gold from west to east. While China vies to extend its influence over the bullion market with new contracts aimed at luring international investors, trading volumes are still a fraction of those in London, where benchmark prices are determined.

“Asia more generally is becoming more important and there are going to be increasing flows in this direction,” Wayne Gordon, an analyst at UBS Group AG in Singapore, said by phone today. “But at least at this stage, London’s still where the trade is. The reality is that everybody still uses London values as the benchmark.”

Average daily volumes for the SGE’s 99.99 percent purity contract increased to about 20,427 kilograms (656,743 ounces) in October from 11,704 kilograms a year earlier, according to exchange data. By comparison, an average 17.4 million ounces changed hands daily between members of the London Bullion Market Association, according to the group’s data.

Falling Demand

“Volumes may increase further next year as the exchange will seek to expand its members to include more Chinese equity brokerage firms, because they can bring in more investors,” Xu said at the conference in Shanghai. “The bourse is also going to introduce a trading platform on handheld devices to meet modern-day investors’ needs.”

Trading is growing even as consumption in China slows as an anti-graft campaign hurts demand for luxury goods and last year’s price-driven demand surge wasn’t repeated. Gold tumbled into a bear market in 2013 and banks including Goldman Sachs Group Inc. expect prices to extend losses as the U.S. Federal Reserve moves closer to raising borrowing costs for the first time in eight years.

Demand in China slumped 37 percent to 182.7 tons in the three months to September from the same period in 2013, the World Gold Council said in a Nov. 13 report. Jewelry consumption fell 39 percent to 147.1 tons in the quarter, while demand for bars and coins slid 30 percent to 35.6 tons, the council said.

Bullion of 99.99 percent purity in Shanghai rose 0.3 percent this year after plunging 29 percent in 2013. In London, gold for immediate delivery traded at $1,205.03 an ounce at 6:12 p.m. Shanghai time. Prices are little changed in 2014 after last year’s 28 percent slump, which was the biggest in more than three decades.
"Price is the most important factor to use in relation to value."  - Walter Schloss

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Roubini: Currency wars coming, but don't bet on gold
« Reply #4 on: December 04, 2014, 08:04:02 AM »
Roubini: Currency wars coming, but don't bet on gold

At the end of October, the Bank of Japan announced that it would increase its quantitative easing program.  In an unexpected move, the bank increased its purchases of Japanese government bonds to grow its monetary base to 80 trillion yen (about $730 billion) per year up from 60-70 trillion yen.

Nouriel Roubini, professor at New York University and chairman of Roubini Global Economics, believes that this was a dangerous move that could trigger a round of currency wars. “Domestic demand is weak in advanced economies, and the only way to grow the economy is to weaken currency in order to boost net exports,” he says. Because trade balance is a zero sum game, he explains, countries have to compete for a larger share of the market by continuing to lower their currencies.  Roubini predicts that this will lead to a full-out currency war.

Roubini says that reactions to Japan’s increase in QE can already be seen throughout Asia. “From Korea to Malaysia to Thailand…even the Central Bank of China has recently cut rates to avoid the strengthening of its currency.” While China is not outrightly participating in QE, the central bank recently moved to loosen monetary policy by reportedly lending the state-owned China Development Bank one trillion yuan (over $160 billion). On November 6, the Chinese central bank confirmed that it had lent an additional 769.5 yuan to commercial banks.

Currency war contagion

The contagion of lowering currency value will hit Europe next, says Roubini. “The first to be hurt by a weak yen [will be] Germany and the Eurozone so the ECB will have to do quantitative easing,” he says. “The Swiss National Bank, the Norwegians and the Central Europeans” will have to follow.

All of this easing would imply that the only currency increasing in value will be the U.S. dollar, leading to a currency shock stateside. Janet Yellen and the Federal Reserve plan on increasing rates towards the middle of 2015, “but if the rest of the world growth disappoints…and the dollar keeps appreciating, at some point those facts are going to weaken U.S. growth and inflation and weaken U.S. competitiveness.” This, Roubini believes, will force the Fed to delay hiking rates.

The price of gold

Even with currency wars, gold will remain weak, says Roubini. “For now the Fed is not easing, and the dollar is strengthening,” he says. Gold is a hedge against inflation, but Roubini believes there are many assets now that are better and that can provide an income, like real estate, equities and credit. Gold can only provide capital gains. “Real rates are going to go higher so all of the main factors regarding gold indicate that gold will go down.” He says the rate will near $1000 per ounce by the end of 2015.  It currently hovers at around $1200 per ounce.
"Price is the most important factor to use in relation to value."  - Walter Schloss

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Re: COULD A GOLDEN ROUBLE CATALYSE A GLOBAL REMONETISATION OF GOLD?
« Reply #5 on: January 18, 2015, 10:36:58 PM »
Ops.....


One month ago saw the article



Now then post :P



Gold set for biggest weekly rise in six months as stocks, dollar slip

LONDON (Reuters) - Gold edged lower on Friday as some buyers cashed in recent gains, but remained on track for its biggest weekly rise since June as the dollar retreated and sliding oil prices hurt risk appetite and stocks.

Gold is up nearly 3 percent so far this week, following a 2.1 percent jump the previous week. Falling stock markets have prompted some investors to buy the metal as an alternative asset, while a drop in the greenback made dollar-priced bullion cheaper for other currency holders.

Spot gold was down 0.2 percent at 1302 GMT at $1,225.10 an ounce at 1302 GMT, while U.S. gold futures for December delivery fell 30 cents to $1,225.30.

"Gold and silver have both had a very good week, going against the trend seen elsewhere," Saxo Bank's head of commodity research Ole Hansen said. "We have reached levels which short sellers have been attracted to in the past and this may slow the positive momentum that has emerged during the past week."

"Overall there is a feeling out there that traders are now going defensive on their positions and this is weakening the dollar, thereby adding some support to precious metals."

The dollar index was down 0.4 percent on Friday and European stocks slid another 1.3 percent, with further declines in the price of oil hitting energy stocks and political concerns over Greece also curbing risk appetite.

Benchmark Brent crude oil futures fell 1.3 percent to below $63 a barrel, the lowest since July 2009. Brent is down 8 percent this week, and 45 percent below its June peak.

The improved sentiment towards gold was seen in the holdings of the world's top bullion-backed exchange-traded fund, SPDR Gold Trust, which rose 0.13 percent to 725.75 tonnes on Thursday, up nearly 5 tonnes this week.

That marks a second straight week of inflows, and the biggest weekly increase in its holdings since early July.

"The longer gold holds above $1,200, the more it may attract fresh buying and gold ETFs may begin to build," HSBC analysts said in a note.

Among other precious metals, silver was up 0.2 percent at $17.11 an ounce, while spot platinum was down 0.1 percent at $1,234.99 an ounce and spot palladium was down 0.3 percent at $813.50 an ounce.

"Price is the most important factor to use in relation to value."  - Walter Schloss

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Re: COULD A GOLDEN ROUBLE CATALYSE A GLOBAL REMONETISATION OF GOLD?
« Reply #6 on: January 18, 2015, 10:39:03 PM »
肖磊:中国外汇储备对美国有威胁吗



 文/新浪财经专栏作家 肖磊

  事实也证明,拿美元外汇储备和持有的美国国债来“享有”对美国政府的“操控感”或“安全感”,可能是中国、俄罗斯等国政府的一厢情愿。美国人真正的目的就是要让中国人相信美国确实对中国的美元储备充满恐惧,只有这样,中国才会以“安全”和“博弈”为考虑,不断的囤积美元。

一直以来,市场上流传着这样一个故事,每当中国在政治外交领域需要美国支持的时候,就会买入美国国债,当中国对美国的某些行为表达不满的时候,则会抛售美国国债。一些美国参议员也经常担心中国减持美国国债会对美国经济产生系统性风险,而中国外交部和财政部也时常督促美国要采取负责任的政策,以保障中国在美投资安全。

  中国看上去“巨量”的四万亿美元外汇储备,以及持有的一万多亿美元的美国国债,成了中美关系当中最受市场和政客们关注的点。每一次中国对美国国债的增持或减持都会引起各领域的猜测,这使得整个市场都以为中国拥有的美元储备以及持有的美国国债已经成了能够“威胁”美国的一个重要手段。事实真的是这样吗?

  2008年之前,随着美国陷入反恐战争泥潭,美国越来越依赖“负债”,如果没有更多的资金愿意进入美国债券市场,美国诸多的国家战略可能会面临停滞。但如果让更多的海外机构持有美国国债,美国也会但心战略性风险,因为一旦这些国家并不支持美国的一些做法,就会以抛售美国国债来相要挟。

  但自2008年之后,美国金融市场巨变,美国进入了疯狂的负债期,其债务规模的增速一度震惊世界。要知道美国从1776年建国到2008年232年时间里,其债务规模一直保持在10万亿美元以内。而在奥巴马上任后的短短5年时间,美国债务规模就飙升到了18万亿美元。正是由于2008年之后连番多次的量化宽松(QE),稀释了中国外汇储备,以及降低了持有的美国国债在整个美国货币和债务池子当中的百分比,使得中国外储对美国整个金融市场的影响力明显下降。

  2008年末中国外汇储备1.95万亿美元,当时美联储资产负债表不到1万亿美元,而目前中国的外汇储备不足4万亿美元,美联储的资产负债表却已经超过4.5万亿美元。也就是说,2008年时,中国的外汇储备是美联储资产负债表的接近两倍,到了2014年,中国外汇储备只占到了美联储资产负债表的不足90%。

  2008年末,美国国债总规模10万亿美元,中国持有美国国债接近8千亿美元,占整个美国国债的比例达7.5%。中国目前持有美国国债12679亿美元(截至今年8月末),不到六年时间多增持了超过70%。但美国国债的增长速度更快(已达18万亿美元),中国持有的美国国债占整个美国国债规模的比例不升反降,目前已从7.5%降到了7%。

  无论从美联储扩张负债表的能力,还是美国政府负债的速度来看,中国的外汇储备和持有美国国债的数量占美国货币和债务市场的比例已明显下降。更为神奇的是,在美国疯狂举债的这六年时间里,美国控制住了通胀和就业,并且维持了极低的利率水平,还保持住了美元汇率。也就是说,美国依然具备继续扩大“负债表”,稀释中国等“债权”的条件。

  事实也证明,拿美元外汇储备和持有的美国国债来“享有”对美国政府的“操控感”或“安全感”,可能是中国、俄罗斯等国政府的一厢情愿。

  俄罗斯就是一个非常好的例子,早在今年年初美国开始启动制裁俄罗斯之前,俄罗斯就明确表示,一旦美国启动制裁,俄罗斯就会抛售美债、降低美元外汇储备。当时俄罗斯美元外汇储备超过5000亿,是全球第五大美元外汇储备国。但美国并没有因为俄罗斯要抛售美元而取消制裁,截至目前,俄罗斯总计才抛售了500亿美元外汇储备,但其间卢布已贬值接近20%,其抛售美元的行为对美国市场的影响似乎微乎其微。

  更值得注意的是,就在俄罗斯卢布贬值期间,俄罗斯国内通胀持续高于7%,俄罗斯央行[微博]不得不加速提高利率,目前利率为8%,预计还会再次上调。俄罗斯一些大银行已将抵押贷款利率提高到13%左右,目前俄罗斯银行系统抵押贷款平均利率为12.27%。可以想象,这样高的利率水平对本国经济带来的风险将是何等的严重。迫于此,俄罗斯已宣布,可能在两年内允许卢布自由浮动。俄罗斯近年来持续增加黄金(1222.10, -3.50, -0.29%)储备,但可能为时已晚,愿意拿美元换石油的国家很多,但愿意拿黄金去换的不多。

  可以说,拿美元外汇储备和持有美国国债来要挟美国,是一个错上加错的行为,因为决定美元和美债含金量的机构是美联储,不是其他国家,也不是联合国[微博]。中国用三十多年的改革开放,以及不计其数的各类成本,换来了4万亿美元外汇储备,但美国仅仅用不到六年的时间,就将美联储资产负债表轻松扩大到4.5万多亿美元。除了在拯救经济和维持社会福利方面的开支,美国仅阿富汗和伊拉克两场反恐战争就花掉了接近5万亿美元。

  可以说相比美国的印钞和负债速度来说,中国持有的4万亿美元外汇储备对美国来说并不值得忧虑。但美国人心理清楚,如果对中国持有的“巨量”美元不表现出担忧和恐惧,那这个游戏就玩不下去了。美国人真正的目的就是要让中国人相信美国确实对中国的美元储备充满恐惧,只有这样,中国才会以“安全”和“博弈”为考虑,不断的囤积美元。

  实际上伯南克早就说过,根本不担心中国抛售美国国债。伯南克说,中国是根据其希望的汇率水平来购买美国资产的;中国增持或减持多少美国资产是依据其对控制人民币汇率的需要进行的;中国通过人为压低人民币汇率来增加出口,从而推动经济增长。可能大家还没有明白伯南克的意思,他老人家的言外之意是,如果中国不想顾及人民币汇率波动风险和经济增长下滑风险,那就抛售美元吧!

  其实中国的外汇储备不但对美国没有任何威胁,而且还造成了中国自身不得不依赖美元来做人民币汇率调节和推动经济增长的宏观手段,这反而成了美国扼住中国经济咽喉的一个秘密武器。如果出现极端情况,美国开始对中国实施金融制裁,就像俄罗斯一样,中国稍微抛售一点美元储备,人民币汇率可能就会出现大幅波动,整个金融战略就会陷入进退两难的地步。

  中国的崛起跟英国、美国的崛起有根本性不同,在英镑和美元全球化过程中,这两个国家实行的都是“金本位”,全球三分之二的官方黄金黄金储备先后流入到了这两个国家。而中国经济的崛起,所换来的是一大堆美元。因此不得不基于美元来制定计划,而基于美元来考虑和制定中国的货币、金融、经济战略,一开始就难免受制于人。

  中国经济的崛起给全球带来了数不尽的机会和活力,但在诸多美国精英眼中,这反而是全球金融市场不稳定的根源。伯南克就曾指出,中美两国之间的贸易失衡给全球经济带来了威胁,且导致了2008年和2009年金融危机的发生。事实上关于中美贸易失衡的问题,已有多年历史,美联储难道没有提前做出考虑?对于中国这样金融博弈经验不足者,你永远不知道2008年的次贷风暴是美国人有意为之还是无心插柳。

  说白了,美元外汇储备的问题,依然是全球金融权力分配不均和经济实力失衡造成的,中国想要摆脱战略性美元困局,就要真正的履行市场经济承诺,用最先进的市场制度去跟美国持续交锋、博弈,并且死死的绞缠在一起,这样才能让人民币国际地位逐步与中国的贸易和金融业务相匹配,而不至于因为某件事而被孤立、中其圈套(如俄罗斯)。
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Re: COULD A GOLDEN ROUBLE CATALYSE A GLOBAL REMONETISATION OF GOLD?
« Reply #7 on: January 18, 2015, 10:39:31 PM »
Gold climbs as investors seek refuge from volatility

By Jan Harvey

LONDON (Reuters) - Gold hit a 12-week high on Tuesday as investors sought refuge from volatility in the wider markets, with a slide in crude oil prices to their lowest in nearly six years fuelling turbulence in stock markets and currencies.

The gold price peaked at $1,243.60, its highest since mid-October, before retreating as European stocks turned higher and the dollar recovered from an early low. It remained elevated, however, thanks to the depressed oil price.

Spot gold was up 0.3 percent at $1,237.43 an ounce at 1255 GMT, while U.S. gold futures for February delivery were up $5.20 an ounce at $1,237.90.

Gold has risen nearly 5 percent this month as equities, which were boosted last year by hopes that the U.S. economy was on the road to recovery, have come under pressure. Strength in stocks helped to push down gold prices by 1.5 percent in 2014.

"There is an element of beginning-of-the-year exuberence in gold, carrying over from the relative weakness in the equity markets at the moment," Mitsubishi analyst Jonathan Butler said.

"That gold can rally despite the dollar being relatively strong says something of the uncertainty regarding the U.S. economy. There's a question over whether we'll revert to gold as a safe haven, as we've seen in recent days, or if U.S. growth is going to pull through and ultimately drive the dollar higher, with negative implications for gold."

European stocks turned higher, having fallen in early trade after a fresh drop in oil prices hit energy stocks. Brent crude oil futures slid 4 percent to their lowest in almost six years.

The dollar index rose after the U.S. currency skidded to its lowest level against the yen in a month as Treasury yields fell because of increased demand for safe-haven assets against the backdrop of plunging oil prices.

Silver was up 2.2 percent at $16.89 an ounce while platinum returned to parity with gold after spending most of the past 18 months at a premium to the yellow metal.

Spot platinum was up 0.3 percent at $1,241.50 an ounce, while spot palladium gained 1 percent to $814.50 an ounce.

"Gold has been leading the move higher so far in 2015 and the rest of the precious metals have mostly been followers," UBS said in a note.
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Gold Fever Fading as $4bn Erased from Funds
« Reply #8 on: February 26, 2015, 09:25:08 AM »
Gold Fever Fading as $4bn Erased from Funds
By Editing NAI
02/23/2015 12:11 p.m.
Judging by the barometer of hedge-fund interest, there’s less to get excited about in gold these days.

Even as Greece battled with its creditors to avoid default and keep the euro zone intact, speculators retreated from the metal used as a haven from economic and political upheaval. Money managers cut their net-long wagers by the most in 15 weeks, U.S. government data show.

The strengthening dollar and record valuations for global equities are diminishing bullion’s appeal as a store of wealth. As the combined market capitalization of stocks thundered through $67 trillion last week and the dollar traded at its highest level in at least a decade, this month’s losses in exchange-traded products backed by gold reached $4 billion.

“Longer-term, we’re still negative on gold,” Jack Ablin, the Chicago-based chief investment officer at BMO Private Bank, which oversees about $66 billion, said by phone Feb. 19. “I view it as insurance. If nothing happens, you should expect to lose money on it. Most of the time, nothing happens. As a risk asset, I think equities are more attractive.”

  The net-long position in gold tumbled 18 percent to 110,164 futures and options contracts in the week ended Feb. 17, according to U.S. Commodity Futures Trading Commission data. It was the third consecutive decline, the longest streak since November. Short holdings surged 44 percent, the most since August.

Futures lost 1.8 percent last week to $1,204.90 an ounce on the Comex in New York, while the Bloomberg Commodity Index declined 1.7 percent. The Bloomberg Dollar Spot Index climbed 0.4 percent. The S&P 500 Index of U.S. equities rose 0.6 percent and reached a record Feb. 20.

Emergency talks by euro-area finance ministers on Friday led to a provisional deal intended to keep aid flowing to Greece. Even before then, gold had failed to attract much buying, with holdings in global ETPs little changed last week at 1,671.8 metric tons, data compiled by Bloomberg show.

John Paulson, the billionaire hedge fund manager, also is showing less enthusiasm for the metal these days. The investor kept his stake in the world’s biggest ETP backed by bullion unchanged for a sixth straight quarter. As of Dec. 31, Paulson & Co. owned 10.23 million shares in the SPDR Gold Trust, a government filing showed last week. Each share represents about 0.096 of an ounce.

Gold slumped 29 percent in the two years through 2014, the first consecutive annual declines since 1998, as equities surged and the U.S. economy gained traction. Futures fell 5.9 percent in February, heading for the first monthly drop since October.

Minutes from the Federal Reserve’s January meeting showed some policy makers argued for keeping interest rates near record lows for longer. The policy makers cited a strengthening dollar, international flash points from Greece to Ukraine and slow wage growth among reasons for delaying the first rate increase since 2006, according to the record released on Feb. 18. Higher borrowing costs cut gold’s allure because the metal generally offers returns only through price gains.

“Given the big drop we’ve had in the last month, I would certainly be bullish on gold,” Adrian Day, the president of Adrian Day Asset Management in Annapolis, Maryland, which oversees about $145 million, said by phone Feb. 19. “The Fed minutes were extremely positive. The longer the Fed goes on, the more difficult it is for them to raise interest rates, because increasingly, they’re waiting for perfect conditions.”

Source: Bloomberg
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Investors Sell Gold Holdings in Longest Run in a Year
« Reply #9 on: March 18, 2015, 10:47:09 PM »
Investors Sell Gold Holdings in Longest Run in a Year

By NAI Editing
03/17/2015 11:52 a.m.
Investors sold holdings in gold-backed funds for a 14th day, the longest run in more than a year, as the Federal Reserve began a two-day meeting. Platinum reached the lowest since 2009.

Global holdings in bullion-backed ETPs fell 2 metric tons to 1,638.4 tons as of Monday, according to data compiled by Bloomberg. The run of losses was the longest since January last year.

Investors are waiting to see whether the Fed decides that the U.S. economy has gained enough momentum to warrant removing a pledge to be “patient” on raising borrowing costs, which would damp gold’s appeal as it generally offers returns only through price gains. The dollar surged to the highest in a decade against major counterparts last week and hedge funds exited gold at the fastest pace in more than four months on speculation the Fed is getting closer to increasing rates.

“The dollar has risen almost relentlessly on expectations for higher interest rates, and as the European Central Bank eases in contrast to the U.S.,” Matthew Turner, an analyst at Macquarie Group Ltd. in London, said by phone on Tuesday. “That and the anticipation of the Fed changing its language towards a rate hike have driven prices, and gold’s been the casualty.”

Gold for immediate delivery was little changed at $1,154.16 an ounce by 10:42 a.m. in London. The metal reached $1,147.72 on March 11, the lowest since Dec. 1. Gold for April delivery was unchanged at $1,153.20 on the Comex in New York. Futures trading volumes on the Comex were 43 percent below the average over the past 100 days for this time of day.

Platinum fell 0.2 percent to $1,105.88 an ounce, and earlier Tuesday reached $1,101.05, the lowest since July 2009. Above-ground platinum stockpiles equivalent to about 62 weeks of global consumption at the end of 2014 represent “one key reason for continued platinum price weakness into 2015,” Citigroup Inc. said in a report dated March 17.

Silver fell 0.5 percent to $15.5739 an ounce. Palladium slipped 0.3 percent to $777.65 an ounce.

Source:Bloomberg
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India Could still Cut Gold Import Duty This Year – WGC
« Reply #10 on: March 18, 2015, 10:48:22 PM »
India Could still Cut Gold Import Duty This Year – WGC

By NAI Editing
03/17/2015 1:04 p.m.
The Indian government may yet cut the 10-percent import duty on gold this year despite choosing not to do so in this year’s budget as many market observers had expected, Somasundaram PR, the World Gold Council’s managing director in India, said.

“They have not cut it because they said ‘let us evolve, let us pass a few bills’ but 10 percent is still a lot of money,” “When push comes to shove, it will be reduced but they will wait for certain other things but, as I see it, things are moving in the right direction.”

The Indian government confounded widespread speculation for drop of 2-4 percentage points in the duty, which has stood at 10 percent since August 2013 – it was raised three times that year from the initial four percent.

The finance ministry opted instead for further measures to monetise the metal through the introduction of a gold-centric bond and an overhaul to its gold deposit scheme.

These are the latest state-led initiatives to tap into the vast wealth currently stored by Indian families. Should they prove successful, they could ease over the long term the need to import gold – though previous attempts have foundered, failing to find support among grassroots consumers.

The new bonds will carry a fixed interest rate and will be redeemable in cash pegged to the face value of gold at the time of maturity. As well as giving investors long exposure to gold, they will also earn a fixed interest rate – gold typically has no direct yield.

But Somasundaram doubted whether the schemes, particularly the gold-centric bonds, will find much traction with the Indian public.

“Say I have to pay 30,000 rupees today for 10 grams… without the duty, it would be 26,000 or 28,000 rupees,” he said. “So are you going to charge me 30,000 rupees for a bond and then lower the import duty in six months’ time?”

“I have said it personally before that none of the schemes will work because 10 percent [in import duties] is still a huge incentive for smuggling. As long as smuggling prevails, none of these schemes will work,” he added.

Smuggling has been an issue in the Indian gold market for some time, particularly prior to the removal of the 80:20 rule in November, which made it mandatory to export 20 percent of all imported metal.

Some 175 tonnes of gold entered India illegally last year, Somasundaram believes. India’s total demand in 2014 was 842.7 tonnes, a drop of 13.5 percent on the previous year’s total of 974 tonnes, according to WGC figures.

Source:FastMarkets
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Re: COULD A GOLDEN ROUBLE CATALYSE A GLOBAL REMONETISATION OF GOLD?
« Reply #11 on: December 07, 2018, 11:22:41 AM »
 :clap: :thumbsup: :thumbsup:

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Re: COULD A GOLDEN ROUBLE CATALYSE A GLOBAL REMONETISATION OF GOLD?
« Reply #12 on: December 07, 2018, 02:54:00 PM »
nice!  :clap: :thumbsup: