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Standard Chartered: ETP Gold Holdings Up 24.4 Tonnes In April

Kitco News

Exchange-traded-product holdings of gold are higher so far this month after investors increased their exposure to the precious metal in the first quarter, led by buying in the U.S. and China, says Standard Chartered. “ETP holdings are up 24.4 tonnes (t) so far in April, compared to inflows of 47t in Q1 2018,” Standard says. “While Europe holdings were relatively insulated last year, the baton has passed to North America and Asia this year. Metal held in trust in Q1 was up 38t in North America (driven by the U.S., as Canada is flat) and up 11.9t in Asia (mostly driven by China), but down in Europe. We think a key weak spot in the market is the absence of retail investors in the U.S., but a turn in ETP flows suggests that local appetite for gold may be turning.”

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

 

FXTM: Gold Weaker But Geopolitical Worries May Limit Downside

Thursday April 12, 2018 9:44

Gold is facing pressure from expectations for more U.S. interest-rate hikes but at the same time may draw support from geopolitical worries, says Lukman Otunuga, research analyst at FXTM. The analysts blames weakness in gold Thursday on hawkishly construed minutes from the latest policy meeting of the Federal Open Market Committee, boosting expectations for a faster pace of monetary tightening this year. “Although the yellow metal may find itself exposed to downside risks in a high interest-rate environment, losses could be limited by risk aversion,” Otunuga says. “With geopolitical risk, U.S.-Russia political uncertainty and lingering trade-war fears still weighing on sentiment, gold, which is often popular in times of financial uncertainty, is likely to remain supported.” Spot gold was around $1,343 an ounce at 9:15 a.m. EDT. “Previous resistance around $1,340 could transform into a dynamic support that can encourage an appreciation back towards $1,360,” Otunuga says. “A failure for bulls to maintain control above $1,340 could result in prices sinking towards $1,324.”

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

 

Standard Charted: Gold Faces Upside ‘Hurdle’ Yet ‘Floor Looks Well Supported’

Thursday April 12, 2018 9:44

Gold is facing technical hurdles on the upside as the range-bound market remains caught between political and economic drivers, says Standard Chartered. Gold prices tested intra-year highs Wednesday on a flight to safety driven by the escalating uncertainty about U.S. sanctions on Russia and U.S.-China trade tensions, Standard says. “Tactical positioning was relatively light, suggesting scope for additional net length; however, U.S. inflation data and March FOMC [Federal Open Market Committee] minutes stalled gold’s rally. The hawkish minutes knocked the wind out of gold’s sails, and we expect prices to test the downside as we approach the June FOMC.” Standard Chartered describes the physical market as “somewhat mixed” although with buying from India. “However, gold’s floor looks well supported amid the geopolitical uncertainty, especially as exchange-traded-product buying has turned positive. The upside still appears to be a difficult hurdle to breach.”

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