You are hereHome CategoriesNews
Pondering gold's last 11.5 years of performance while anticipating the EU summit
Source: Sharps Pixley , Author: Posted by BI-ME staff
Posted: Wed June 27, 2012 11:13 am

INTERNATIONAL. After falling 3.76% last week, the U.S. Comex gold futures climbed US$8, or 0.51% in the first 2 days of this week. The S&P index dropped 1.1% after falling 0.58% last week, while the Stoxx index plunged about 2.7% after a gain of 0.26% last week.

The Euro/Dollar continued its decline, and fell 0.63% this week, after falling 0.54% last week.

The real action has been in the commodities markets, where crude oil futures fell 25% from the peak in 2 May at US$106.16 to currently US$79.36, while the corn futures surged 23% from the recent trough in 15 June at US$506 to currently US$624.

Oil fell in relation to global economic weakness, while corn price was squeezed because the dry weather in the U.S. Midwest region has restricted supply.

On investors' flows, the CFTC reported that managers and traders have raised their net-long positions in the U.S. futures and options by 7% in the week to 19 June, just when commodities have fallen into a bear market.

The gold net non-commercial combined positions have risen for the third week to 138,011 contracts, rebounding from the recent trough in 29 May.

The physically-backed ETP holdings rose 38.7 metric tons month-to-date to within 0.1% of the March's peak level, which continues to be a positive factor for gold price.

Traders have been waiting on the sidelines for the results of this week's EU Summit, not knowing whether Europe will adopt more concrete steps towards fiscal and banking unions, or will face a full banking crisis and a Euro collapse.

Disappointing debt auctions for Italian and Spanish bonds caused their yields and European tensions to rise, raising demand for the U.S. dollar and hurting gold price. Dollar assets have also been supported by better U.S. home prices, which fell 1.9% on a yearly basis in April, the slowest rate of decline in a year.

Like we said before, gold price has been hampered recently by deflationary, or more accurately, disinflationary forces, and the U.S. dollar strength. However, despite the economic headwinds, the European credit crisis, and the stock markets' volatility, gold futures are still up 0.5% for this year, and have risen in 11 consecutive years, beating most other major asset classes.

Gold has not only preserved the investors' portfolio value, but has also enhanced portfolio performance in both good and bad economic times.

Note: SharpsPixley.com is the the online platform for Sharps Pixley Ltd, a physical precious metals trader.

SharpsPixley.com aims to bring you the latest gold news, live gold prices and gold charts and is an online shop for buying gold bars and gold coins.

Buying gold has never been easier or more attractive and is a great investment. SharpsPixley.com will allow those interested in buying precious metals to buy gold against the live spot price of gold, and SharpsPixley.com will keep you informed of all the latest market trends using our gold news feeds, our gold charting tools, and displaying live gold prices from around the world.

This article is republished with permission from Sharps Pixley.

Click here for more information about Sharps Pixley.

© Copyright Sharps Pixley 2012

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

RELATED ARTICLES

Deflationary forces overwhelm gold

Fed 'influencing gold more than eurozone' as Spanish borrowing costs soar

Long-term investors diversify into gold while markets ponder next move

More will join China and Australia in rate cutting, better gold price ahead?

Gold bounce awaits a rescue plan for the euro

The next BIG THING in gold: Possible purchase of 1700 tonnes gold

Central bankers bought more gold while European leaders kept talking

Drawing lessons from Gold-Dollar relationship in 2008 and 2009

Silver rally by no means over, could rise to US$100 - Dubai Precious Metals Conference

Central bankers leading the way on gold

A return to real money - gold and silver

Buffett is wrong on gold bubble, says Peter Schiff

James Rickards sees gold standard at US$7,000 per ounce in the face of a dollar collapse

Peter Schiff: Was 2011 the end of the gold rush?

 

 

MIDDLE EAST BUSINESS COMMENT & ANALYSIS

date:Posted: March 27, 2017
UAE. PwC issues new report jointly with the Global Manufacturing & Industrialisation Summit; The report outlines a roadmap for CIOs to manage the transformation of industrial companies to successfully adopt IIoT; Devising a digital strategy is key for manufacturers
date:Posted: March 27, 2017
UAE. The strongest growth rate for 2014-2015 in the region was led by Saudi Arabia and the UAE, according to a new report from The Boston Consulting Group.
date:Posted: March 27, 2017
UAE. As banks seek to be more competitive and enhance customer experiences, many look to transform their old legacy banking systems with more efficient new core solutions.
UAE. PwC issues new report jointly with the Global Manufacturing & Industrialisation Summit; The report outlines a roadmap for CIOs to manage the transformation of industrial companies to successfully adopt IIoT; Devising a digital strategy is key for manufacturers
dhgate