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Standard Chartered: Gold-Price Dips 'Around $1,250/oz Should Be Bought'

Kitco News

Standard Chartered views weakness in gold prices as a buying opportunity. “The past three Fed [rate] hikes have marked cycle lows for gold, but the lows are rising, and we believe dips around $1,250/oz should be bought,” analysts say. Standard estimates that 340 tonnes of physically backed exchange-traded products would become loss-making should prices breach $1,200 an ounce, meaning more potential downside risk if these investors exit. “However, physical demand, particularly from India and China, has been increasingly price-elastic on dips towards $1,200/oz, which should limit the price downtrend,” the bank says. Analysts this week listed an upbeat outlook on gold due to the bank’s view on U.S. Treasury yields and the U.S. dollar.

By Allen Sykora of Kitco News; asykora@kitco.com

 

Commerzbank: Swiss Data Suggest ‘Robust’ Asian Gold Demand

Thursday June 22, 2017 09:06

The most recent Swiss trade data suggest “robust” gold demand in Asian nations, reports Commerzbank. Switzerland exported 170 tonnes of gold in May, the most so far this year. Seventy percent was shipped to Asia. This includes 67.8 tonnes shipped to India, the most since November 2015. Part of this could be Indians moving ahead gold purchases because of a goods and services tax to be levied on the metal starting July 1, Commerzbank explains. Meanwhile, Swiss exports to China and Hong Kong combined amounted to “only” 51.2 tonnes, less than last month. “All in all, the Swiss data reflect robust Asian gold demand,” Commerzbank concludes.

By Allen Sykora of Kitco News; asykora@kitco.com

 

Walsh’s Lusk: Traders Reluctant To Pressure Gold Below $1,240/Oz

Thursday June 22, 2017 09:06

There seemed to be a reluctance to sell gold below the $1,240-an-ounce level as prices hit a roughly five-week low on Wednesday, says Sean Lusk, director of commercial hedging with Walsh Trading. Gold got a reprieve from recent weakness due to a softer stock market. “The problem as I see it for any major upside for gold is the deflationary overtone in the market following last week’s Fed meeting and announcement,” Lusk says. He comments that Federal Reserve Chair Janet Yellen “eschewed” the Fed’s 2% inflation target and focused on near-term goals of unwinding the central bank’s massive balance sheet while returning to normal rate policy. “The hawkish views emanating from the FOMC has given the dollar a bid while giving a significant downside washout to the energy and metals sector,” he says. August gold bottomed at $1,241.70 an ounce Wednesday but has bounced since, trading up $6.70 to $1,252.50 as of 8:37 a.m. EDT Thursday.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.