Make Kitco Your Homepage

MKS' Nabavi: gold falls on profit-taking after limited Chinese buying

Kitco News

Gold prices fell in overseas trading early Monday when the expected demand in China failed to materialize and profit-taking set in, said Afshin Nabavi, head of trading with MKS. Gold rose last week on coronavirus worries while trading in China was shut down for the Lunar New Year holiday. “The market opened up in China after one week of holiday,” Nabavi told Kitco News. “The market was anticipating higher gold. And at the opening in the Far East, it rallied $4 or $5, and suddenly there was some profit-taking that came in. There was not much interest in buying gold.” Thus, traders started squaring positions, he continued. Still, he said, the metal held around the $1,574 to $1,575 area, meaning it remains in its recent trading range.” As of 7:39 a.m. EST, spot gold was $9.60 lower to $1,578.90 an ounce.

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

 

Commerzbank: India disappoints industry by not lowering import tax on gold

Monday October 21, 2019 09:03

India’s government did not lower the import tax on gold, as the country’s industry had hoped, meaning smuggling of the yellow metal into the country is likely to continue, said Commerzbank. “Once again, the Indian government has ignored calls for the gold import tax to be reduced and has left it unchanged at 12.5% in the budget it presented for the new fiscal year,” Commerzbank said. “Indian gold demand is finding no support from this side, in other words, and gold smuggling is likely to continue to thrive. According to the World Gold Council, 27% more gold was already smuggled into India last year than the year before.”

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

 

BBH: ‘big data week for the U.S.’ but economy still strong

Monday October 21, 2019 09:03

This will be “a big data week for the U.S.,” said Brown Brothers Harriman, but adding that the economy appears to be holding up despite a surprisingly weak Chicago Purchasing Managers Index on Friday (fell to 42.9 versus 48.9 expected.” Reports this week will include the Institute of Supply Management manufacturing survey Monday and service-sector index Thursday, the ADP private-sector jobs report Wednesday and nonfarm payrolls on Friday. “The U.S. economy remains strong,” said BBH, pointing out that the government reported a seasonally adjusted annual rate of 2.1% growth in fourth-quarter gross domestic product last week. “The Atlanta Fed’s GDPNow model estimates Q1 GDP growth at 2.7% SAAR, while the NY Fed's Nowcast model estimates Q1 GDP growth at 1.6% SAAR,” BBH said. “While these early reads are far apart and subject to significant revisions, we are clearly far from recession and the Fed is right to maintain steady rates for now and assess how the outlook unfolds in 2020.” The yield on the U.S. three-month and 10-year Treasury curve remains inverted, often seen as a warning of recession. However, BBH said, “The U.S. economy is nowhere near recession, and we think the bond market is wrong here.”

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.