Russia, Korea And Central Banks Accumulate Gold On Dip Below $1,600/oz
Today’s AM fix was USD 1,580.50, EUR 1,213.25 and GBP 1,054.02 per ounce.
Yesterday’s AM fix was USD 1,574.00, EUR 1,207.98 and GBP 1,043.42 per ounce.
Silver is trading at $28.94/oz, €22.33/oz and £19.37/oz. Platinum is trading at $1,602.50/oz, palladium at $746.00/oz and rhodium at $1,200/oz.
Gold climbed $8.40 or 0.53% yesterday in New York and closed at $1,583.40/oz. Silver finished with a gain of 1.33%.
Gold edged lower today and sentiment remains poor due to the recent price falls.
Later today the markets will digest the outcomes of policy meetings of the ECB, Bank of England and Bank of Japan. Ultra loose monetary policies are set to stay which will support gold. Indeed, the British government may be set to hand Carney in the BOE even more powers which will usher in even looser monetary policy.
Central banks are among the shrewd investors who buy gold bullion on dips. It was reported that South Korea bought 20 tonnes of gold last month rumoured to be below the $1,600/oz mark. This is the first purchase this year for South Korea, after they purchased 30 tonnes in 2012. Previously they purchased in July 2012 at the same price levels.
When gold was weak during May to July of 2012, central banks actively bought nearly 71 tonnes.
Russia and Kazakhstan’s bought 12.2 and 1.5 tonnes in January, but until the IMF reports official activity, may help the very poor sentiment towards gold today. Central banks utilize gold bullion to diversify their holdings and limit their foreign exchange exposure.
South Korea’s FX reserves ranked 7th in the world at the end of January. However, their gold reserves remain a tiny fraction of their overall foreign exchange reserves which were valued at $327.4 billion in February.
“The Bank of Korea’s gold buying is part of the long-term diversification of currencies and assets in foreign-exchange reserves,” it said in the statement. “It is of no great importance to try to gauge if it’s
profitable or not based on short-term price swings.”
The World Gold Council noted that central banks increased gold buying 17% to 534.6 tons last year.
Smart, prudent money continues to accumulate, particularly on the dips, while the unfortunate 'dumb' money continues to sell on weakness as seen in the significant liquidation in ETF positions in recent days.
Webinar: Everything you need to know about Silver in 60 minutes.
Date: 13th March, 2013, 1900 - 2000 GMT
Speakers: David Morgan publisher of the Morgan Report and GoldCore Director Mark O'Byrne
Do you want answers on why silver should be part of your investment portfolio and why silver is a form of saving and financial insurance? Do you want to know the safest way to own silver? Do you want the opportunity to put your own questions to two leading world authorities on silver? We'll help you in this complimentary webinar, "Everything you need to know about Silver in 60 minutes."
To register click here!
Gold struggles to pierce range, US growth hopes weigh - Reuters
China's SGE to launch after-hours trading in Gold & Silver – Bullion Street
Video: Good To Own Gold and Silver For Long Term - CNBC
Dow Record Nice, $3,000 Gold Nicer: Rosenberg – Market Watch
Paper Markets To Disappear As Gold War Rages – JS Mineset