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Updated 22:34 10/05/21

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July Gold News 2014

The gold price fell yesterday as stronger than expected U.S. GDP boosted the U.S. dollar.

U.S. GDP expanded at annualised rate of 4% for Q2 following a disappointing 2.9% contracted in Q1. Following the announcement the U.S. dollar rose against a basket of currencies to a 10 month high and gold price fell back 0.3% to $1,295.20 per ounce.

The dollar rose on expectations that Fed may now raise interest rates soon than expected.

The gold markets are also closely watching events in Gaza and the Ukraine as any further escalation in violence should boost the gold price.

Yesterday Israeli forces bombed Gaza’s only ...

31 Jul 2014, 9:59 a.m.
Duncan Richardson

The four banks which conduct the 100 year old daily gold fix and the London Bullion Association (LBMA) will seek proposals for an independent body to run and administer the new London gold fix.

The London Gold Market Fixing Company, who currently oversees the process, and the LBMA confirmed they will announce the new administrator by the end of September.

The World Gold Council along with industry participants discussed alternatives to the current process in their July meeting. The industry agreed there was a need for both an independent third party to administer the fix and a need to improve the transparency ...

30 Jul 2014, 10:23 a.m.
Adam Pike

The gold price continues to trade above the psychological $1,300 barrier as violence in Gaza and Ukraine continues to support the price.

Investors are now turning their attention to the release of the latest U.S. jobs report and details from the Federal Reserve’s policy meeting which begins today. Traders will be looking for any clues as to when the Federal Reserve will start to raise interest rates.

Any indication that the U.S. economy is strengthening could prompt the Federal Reserve to increase rates quicker than expected. Typically higher rates would encourage investors to buy interest bearing assets at the expense of gold.

The ...

29 Jul 2014, 10:28 a.m.
Adam Pike

The Bank of Nova Scotia, HSBC and Deutsche Bank have all been accused of manipulating the silver price. The three banks have been named in a U.S. lawsuit filed in the State of New York.

Investor, Scott Nicholson, has accused the banks of abusing their positions to manipulate the silver price to the detriment of investors. Nicholson is now hoping other investors will come forward so a class action lawsuit can be launched.

Deutsche bank resigned its seat on both the gold and silver fix earlier this year following an investigation by German regulator Bafin into possible gold and silver manipulation.

In May ...

28 Jul 2014, 10:45 a.m.
Duncan Richardson

The Central Banks of Korea, Russia Turkey and Kazakhstan all increased their gold in July according to the latest figures published by the International Monetary Fund.

Central Banks from the emerging markets boosted their gold reserves as a response to the ongoing sovereign debt crisis and the continued weakness of traditional reserve currencies such as the Euro and the U.S. dollar.

Russia increased its gold reserves by 18.6 tonnes to 936 tonnes, Turkey boosted their reserves by 44.7 tonnes to 288.9 tonnes, Kazakhstan’s increased by 1.4 tonnes and South Korea added 15.5 tonnes to bring its total central bank holdings to 70 ...

28 Jul 2014, 10:42 a.m.
Duncan Richardson

Olivier Blanchard, chief economist at the International Monetary Fund (IMF) is watching the markets “like a hawk” because the global economy is too weak to tolerate a rise in interest rates.

Although, a rate rise would hurt the global economy the IMF also warned that the current ultra-low interest policies are causing asset bubbles as investor’s desperately search for yield.

The IMF also reduced its 2014 global growth forecast from 3.7% to 3.4% as the bank warns excessive debt levels within advanced economies is limiting growth. The IMF cut its growth forecasts for Germany to 1.9%, Italy to 0.3% and France to ...

25 Jul 2014, 10:51 a.m.
Adam Pike

Indian Finance Minister, Nirmala Sitharaman, has confirmed the government has no plans to reduce the extremely unpopular gold import tax.

Gold imported into India is subject to a 15% import tax and 20% of all gold imported must be exported before any further imports can be made. The restrictions were imposed in 2013 in an attempt to reduce the Indian current account deficit and protect the value of the Indian rupee.

The taxes have been extremely unpopular as gold is central to Indian culture, with Indians buying gold as a store of value and for gifts at weddings and religious festivals. Prior ...

25 Jul 2014, 10:50 a.m.
Victoria Hewitt-Marsh

In the first six months of the year Chinese gold demand fell 19.3% to 569 metric tonnes. The amount of gold sold in the form of bars and coins fell while gold jewellery sales increased by 44.3%.

Gold consumption in China accelerated last year to a record 1,176.4 tons, following a 28% price fall. In 2013 China consumed 28% of the global supply. Despite this recent fall the World Gold Council expects Chinese consumption to increase to 1,350 metric tonnes by 2017 as China’s middle class continues to expand.

China’s retail gold consumption figures are relatively transparent, however, there is ...

24 Jul 2014, 10:29 a.m.
Duncan Richardson

The gold price held above the psychological $1,300 barrier yesterday as geopolitical events in the Ukraine and Gaza maintain support for the yellow metal. Historically, investors turn to gold in times of political and economic uncertainty and is seen as an alternative to equities.

In the Gaza strip Israeli forces continued their ground offence with both sides experiencing causalities. The U.S. and the United Nations are in talks to persuade both sides to agree an immediate ceasefire.

The tensions in the Ukraine eased slightly after pro-Russian fighters passed the flight recorders of flight MH17 to Malaysian authorities and a train carrying the ...

23 Jul 2014, 10:20 a.m.
Duncan Richardson

According to the latest data release from the Swiss Customs Administration department the country exported more than 600 tonnes of gold to Asia in the first six months of the year. Since the beginning of 2014 the Swiss have obliged to disclosure more information on their precious metals exports. In June Switzerland exported 55 tonnes of gold to Asian countries bringing the total for 2014 to 603.38 tonnes.

Switzerland produces a minimal amount of gold. The regions supplying them with gold are as follows, Europe 395 tonnes, South America 227 tonnes, North America 111 tonnes and Africa 87 tonnes.

Out of the ...

23 Jul 2014, 10:01 a.m.
Victoria Hewitt-Marsh

The gold price stabilised overnight above $1,300 per ounce as continuing violence in the Ukraine and Gaza provided support.

Despite calls from the international community to halt the fighting, Israeli continued its ground offence. The Israeli forces bombarded the coast region of Gaza killing 28 members of the same family in one strike alone. As the violence enters the second week the total Palestinian death toll stands at more than 500.

Western governments are threatening Russia with economic sanctions for backing of the pro-Russian fighters who, their evidence suggests, downed the Malaysian Airline MH17.

In a measure of investor sentiment, the world’s ...

22 Jul 2014, 10:20 a.m.
Duncan Richardson

The Russian Central Bank added a further 500,000 ounces of gold to their reserves in June according to the latest data release on the banks website. Russia’s total gold reserves now stand at 921.35 tonnes which is equivalent to 35,200,000 ounces.

Russia has been slowly increasing its gold reserves since the turn of the century at a time when many central banks have decreased their holdings. As of 2013 Russia had the seventh largest gold reserves, sitting behind the United States, Germany, Italy, France, China and Switzerland.

In total Russia’s foreign exchange reserves, which includes both foreign exchange and gold reserves, stand ...

22 Jul 2014, 10:18 a.m.
Adam Pike

The gold price is trading in positive territory this morning as tension continues to build in the Ukraine.

Over the weekend U.S. Secretary of State John Kerry announced the U.S. have evidence of Russian involvement in the shooting of Malaysian flight MH17. International pressure is now being exerted on Russia with Australian Prime Minister, Tony Abbott, expressing deep concern that Pro-Russian fighters remain in charge of the crash site.

David Cameron has signalled his intention to introduce travel bans and freeze assets of high profile Russian businessmen and politicians. The Prime Minister is also expected to ask EU countries to stop exporting ...

21 Jul 2014, 11:15 a.m.
Duncan Richardson

French Bank, Société Générale, is predicting strong continued demand for platinum. The bank believes the metal’s price will be supported by strong global car sales. Platinum is primarily used in catalytic convertors.

Despite the amount of Platinum used in each convertor is decreasing, Société Générale anticipates that the demand for new vehicles from both developed and developing markets will more than compensate for this.

The bank expects demand to increase by 6% to 3 million ounces in 2014.

21 Jul 2014, 11:14 a.m.
Adam Pike

Millions of pounds worth of gold and silver has been recovered from a 150 year shipwreck 200 miles off the Carolina coast.

So far 43 solid gold bars and over 1,300 double American $20 gold coins have been recovered from the SS Central America. Exploration of the site began in April and is expected to continue run until the end of the summer.

The SS Central America was a 280 foot steamship which operated during the Californian gold rush transporting passengers between San Francisco and New York via the Panama cannel. The boat sank whilst carrying a large consignment of gold for ...

21 Jul 2014, 11:14 a.m.
Victoria Hewitt-Marsh

The gold price stabilised overnight above $1,300 per ounce as continuing violence in the Ukraine and Gaza supported the gold price.

Despite calls from the international community to halt the fighting, Israeli continued its ground offence. The Israeli forces bombarded the coast region of Gaza killing 28 members of the same family in one strike alone. As the violence enters the second week the total Palestinian death toll stands at more than 500.

West governments are threatening Russia with economic sanctions for what they say is its backing of the pro-Russian fighters who, their evidence suggests, downed the Malaysian Airline HM17.

In ...

21 Jul 2014, 10:19 a.m.
Duncan Richardson

The gold price surged $20.00 in a matter of minutes yesterday on the news that Malaysian airline MH17 was shot down over eastern Ukraine. Flight MH17 was carrying 295 passengers and was on route from Amsterdam to Kuala Lumpar. The plane came down 25 miles from the Russian border. The Russian and Ukrainian government alongside the leaders of the separatist movement were quick to deny any involvement.

The gold price was also boosted by the news that Israeli Prime Minister Benjamin Netanyahu ordered his military to start a ground offence in Gaza following a week of air strikes.

Prior to the crash ...

18 Jul 2014, 10:38 a.m.
Duncan Richardson

The four banks which set the global price for gold have agreed to allow an independent body to scrutinise the process amid evidence that the process is subject to manipulation.

HSBC, Barclays, Société Générale and Scotiabank set or fix the price of gold twice a day via an auction process. Yesterday, Sky News revealed that the 100-year old pricing mechanism is to be overhauled with an independent Chairman and administrator appointed. The four banks will also have to agree to a new code of conduct which is currently being finalised.

The changes come at a time when pricing benchmarks around the world ...

17 Jul 2014, 10:33 a.m.
Duncan Richardson

The gold price has risen from a 3 week low amid rising demand in both India and China. The palladium price continues to rally and has reached a new 13 year high.

Gold imports into India surged 65% in June to $3.12billion following the Central Bank of India decision to allow more banks to import gold from abroad. The recent price drop below $1,300 spurred physical demand in China with trading volumes rising in Shanghai.

Assets in the world’s largest gold exchange traded fund, The SPDR Gold Trust, fell to 806.03 metric tons yesterday, the first decrease in over a week.

Palladium increased ...

17 Jul 2014, 10:33 a.m.
Adam Pike

The gold price has steadied following two days of losses and currently trades at £756.29 per ounce. The gold price fell as the dollar strengthened following comments from the Federal Reserve that interest rates may have to increase quicker than expected. Prior to the comments the U.S. Dollar was struggling to hold its value against a basket of leading currencies.

Federal Reserve Chairwomen, Janet Yellen, confirmed on Tuesday that the Central Bank was prepared to increase rates if the employment data continues to improve. Although, Yellen was quick to reiterate the Fed will keep monetary policy loose until employment data returns ...

16 Jul 2014, 10:21 a.m.
Duncan Richardson

Silver is the most conductive metal on earth and one of the best thermal conductors.

The total amount of silver consumed and bought for investment purposes has exceeded mine production for years.

Silver is used in over 10,000 industrial applications.

Silver is used in every tablet, mobile phone, computer keyboard and solar panel. This makes silver an essential metal in today’s digital world.

The total market size for silver is only $70 billion versus a total gold market worth $4.3 trillion.

Since the end of World War II the American government have sold their entire stockpile of silver.

Unlike any other financial investment, physical precious metals ...

15 Jul 2014, 10:25 a.m.
Duncan Richardson

The CME Group and Thomson Reuters have won the race to replace the 100 year old silver fix. The silver fix is a pricing benchmark used by industry participants such as central banks, refiners and jewellers to price deals.

The London Bullion Association (LBMA) confirmed on Friday that the CME Group will provide the platform whilst Thomson Reuters will undertake the administration. The joint venture beat a last minute bid by the London Metal Exchange and technology firm Aurilla.

CME/Thomson will start testing the new process in the next couple of weeks and hope to be administrating the new platform by 15th ...

14 Jul 2014, 10:50 a.m.
Adam Pike

Palladium has outperformed silver, gold and platinum in 2014 and is up 17.8%. The other metals have also performed strongly in 2014 with silver up 10.1%, gold up 9.8% and platinum up 7.6%.

Interestingly, some of the world’s largest financial institutions had been predicting a tough year for precious metals sector. So far it appears they have got their figures wrong. Goldman Sachs forecasted an average gold price of $1,200 per ounce, JPMorgan a modest $1,263 per ounce and Credit Suisse $900 per ounce.

Gold is currently trading at $1,321 per ounce, silver $21.16 per ounce, platinum $1,497 per ounce and palladium ...

14 Jul 2014, 10:49 a.m.
Duncan Richardson

The gold price climbed to a 3-1/2 month high yesterday as fears of another Eurozone banking crises returned. Espirito Santo Financial Group, the largest shareholder in Portugal’s largest bank Banco Espirito Santo requested trading of its stocks should be immediately suspended, citing “material difficulties” at its parent company.

The gold price rose during the last sovereign debt crises so it was no surprise the gold price reacted positively in the news. Gold has been climbing slowly since the start of the year as violence in Palestine, Syria, Iraq and Ukraine spurred demand for the ultimate safe haven asset.

The palladium price increased ...

11 Jul 2014, 10:45 a.m.
Duncan Richardson

The palladium price rose 0.8% yesterday to close at a new 13 year high of $869.20 per ounce. Often referred to as a low cost alternative to platinum, palladium has risen for 14 consecutive days and is up a staggering 22% year to date.

Strike action at three of world’s largest palladium mines has caused supply constraints pushing the price to a new all-time high.

Palladium is a vital metal in the production of catalytic convertors. UK based catalytic converter manufacturer, Johnson Matthey, is predicting demand will outstrip supply throughout 2014.

11 Jul 2014, 10:44 a.m.
Adam Pike

The newly elected Indian government has surprised markets by failing to reduce the unpopular gold import tax. Traders had been anticipating a 2%-4% cut. India imports nearly all its gold and is the world’s second biggest consumer of gold.

The import tax was introduced last year in an attempt to lower the country’s current account deficit and protect the value of the Indian Rupee. As a direct result of the import tax, gold imports into India fell 26% in the first quarter of 2014.

Members of India’s Jewellery and gold industry are extremely frustrated as the Bharatiya Janata Party had promised to ...

11 Jul 2014, 10:42 a.m.
Victoria Hewitt-Marsh

The gold and silver price has risen sharply as the solvency of Portugal’s largest bank was put into question. Traders became concerned when Espirito Santo Financial Group missed a debt payment causing stock markets to fall and debt yields to rise. Shares in the bank fell a dramatic 17%.

Yields on Europe’s most indebted countries rose as the news reminded investors the euro zone is still vulnerable to a sovereign debt crisis.

U.S equities also experienced significant declines as the fears in Europe spread to the other side of the Atlantic.

10 Jul 2014, 3:36 p.m.
Adam Pike

The gold price rose to $1,332.20 per ounce during Asian trading following the release of the minutes from the Federal Reserve's latest meeting. Rising tension in the Middle East also supported the gold price.

Minutes from the meeting confirmed Fed officials are becoming anxious the amount of risk in the world economy is being under estimated. The minutes also revealed the Fed plan to end their asset purchase program known as quantitative easing by October. The Fed offered no clues as to when they expect interest rates to rise.

Gold was also boosted by escalating violence in both the Ukraine and the ...

10 Jul 2014, 11:44 a.m.
Duncan Richardson

The London Metal Exchange (LME) has confirmed it would be interested in administering an alternative platform to the London gold fix if it is successful in gaining a mandate to run the silver fix.

The LME is believed to be in discussion with the World Gold Council on reviewing the process behind the 100 year gold fix. The industry has come under increased pressure to review the process behind the fix following a number of accusations that financial institutions have been manipulating the gold price.

According to official figures the London gold and silver bullion market is estimated to be worth $20 ...

10 Jul 2014, 11:43 a.m.
Adam Pike

Germany’s financial regulator, BaFin, has stepped up its investigation in the gold market by demanding German banks and financial institutions hand over data regarding their client’s precious metal holdings. At this stage BaFin has only requested data regarding derivative positions and have given banks until mid-July to supply the information.

BaFin has been investigating possible gold price manipulation for over 12 months. In June 2013 BaFin raided Deutsche Bank’s premises in Frankfurt which eventually led to Deutsche Bank resigning from the London Gold and Silver Fix.

In May Barclays Bank was fined £26m by the Financial Services Authority for allowing one of ...

9 Jul 2014, 10:38 a.m.
Adam Pike

The World Gold Council (WGC) has confirmed that the process behind the 100 year old Gold Fix needs reform. Members of the WGC are currently meeting in London to discuss an alternative to the benchmark. The gold fix is a benchmark used by industry participants such as central banks and jewellers to price deals.

Natalie Dempster, managing director of the WGC confirmed discussions have started and the reforms will lead to a more modernised gold benchmark.

Central Banks, bullion banks, mining companies, traders and refiners are all taking part in the discussions which are being observed by the Financial Conduct Authority.

The gold ...

8 Jul 2014, 10:34 a.m.
Adam Pike

Michel Sapin, the French Minister of Finance is calling upon the international community to stop using the U.S. dollar exclusively to settle international trade. The announcement comes days after French Bank BNP Paribas was fined $8.97 billion by U.S. authorities. Politicians in France have been quick to defend the French based institution, claiming the Bank did not break any European regulations and believe they have fallen victim to U.S. judiciary system.

Sapin told the Financial Times. "We trade within Europe, using the dollar. Do we need this? No, I think we don't. I think we should change the currency balance. ...

8 Jul 2014, 10:33 a.m.
Duncan Richardson

Well respected gold analyst and gata.org representative, Koos Jansen, believes the Peoples Bank of China (PBOC) does not buy any gold via the Shanghai Gold Exchange.

According to Jansen the PBOC main objective is to exchange overvalued U.S. dollars for undervalued gold. Under Chinese law this can’t be achieved via the Shanghai Gold Exchange because all gold bought via the exchange has to be paid for in Renminbi.

Jansen also believes the PBOC does not buy any domestically mined gold because all the gold mined in China again has to be bought and sold in Renminbi via the Shanghai Gold Exchange.

The last ...

7 Jul 2014, 10:42 a.m.
Duncan Richardson

Russia’s gold and foreign reserves rose by $4.7 billion to $475 billion during the period between June 21st and June the 27th. Gold, special drawing rights and all foreign currencies are included in Russia’s official foreign reserve statistics.

In 2013, Russia’s Foreign exchange reserves actually decreased by 5% to $510 billion. Many commentators believe this reduction can be attributed to the Russian Central Bank selling their U.S dollar holdings in an attempt to diversify their holdings.

7 Jul 2014, 10:42 a.m.
Adam Pike

Following a 13% rise in June the silver price continues to rise. Silver climbed to $21.60 per ounce yesterday up from $21.30 on Thursday to reach a new 15 week high.

The silver price has been boosted by increasing geopolitical risk and escalating violence in Iraq, Ukraine Syria and Palestine. Worryingly social unrest has broken out in the oil rich state of Kuwait. Overnight Kuwaiti police fired stun grenades and teargas into crowds protesting against the jailing of prominent dissident Mussallam al-Barrak

Despite better than expected U.S. jobs data the silver price continued to show significant strength.

Silver bars and coins are bought ...

4 Jul 2014, 10:34 a.m.
Duncan Richardson

The Financial Conduct Authority (FCA) has concluded there is no evidence that the London Gold Fix has been manipulated but confirmed the process is open to abuse.

Head of market infrastructure and policy at the FCA, David Bailey, told the House of Commons select committee. “It is possible, but I have no clear evidence that it has actually happened.” Bailey went on to add, “All benchmarks I think are susceptible to people attempting to manipulate them. They are susceptible to a variety of conflicts of interest,"

The gold fix is a pricing benchmark used by industry participants such as central banks ...

3 Jul 2014, 10:52 a.m.
Victoria Hewitt-Marsh

During Asian trading the gold price retreated from its recent three month high as investors wait for the release of a number of key economic indicators. Investors will interpret the data to gauge the health of the global economy.

U.S. unemployment figures will be released today, while minutes of the latest European Central Bank policy meeting will be announced.

Worse than expected data or continued stimulus measures from the ECB will be supportive for the gold price, as gold is typically bought as a hedge against inflation.

The gold price dropped 0.30% to $1,323 per ounce down from its recent three month high ...

3 Jul 2014, 10:51 a.m.
Adam Pike

HSBC expects gold demand in India to increase if the newly elected government reduces the gold import tax. Prior to be being elected the Bharatiya Janata party promised to review the extremely unpopular tax. The import tax was introduced to reduce the country’s current account deficit and protect the value of the Indian Rupee.

Data compiled by the All India Gems and Jewellery Trade Federation estimates the tax caused gold imports to drop by 77% to 150 metric tonnes in the first half of 2014 down from 450 tonnes in the first six months of 2013.

As a result of the tax ...

3 Jul 2014, 7:59 a.m.
Duncan Richardson

The Bank of international settlements has warned dangerous asset bubbles are forming.

Argentina failed to make a $539 million debt repayment.

Italy’s economy shrank by 0.1% in the first quarter of 2014.

Bulgaria is trying to calm down a number of bank runs which is threatening to spiral out of control.

Last month mortgages approvals in the Eurozone declined at its fastest ever rate.

Unemployment in France has reached an all-time high.

Inflation in Japan is increasing at its fastest rate for 32 years.

The unemployment rate in Greece is running at 26.7%.

The European Central Bank introduced negative interest rates.

The U.S. economy contracted by 2.9% in the ...

2 Jul 2014, 10:43 a.m.
Duncan Richardson

Gold coin sales at the Perth Mint have risen to its highest level in four months as the rising gold price increased investor demand. The sale of gold bars and coins increased to 39,405 ounces in May from 36,127 in February.

The U.S. mint also experienced significant increase in demand in June with 1oz gold American Eagle coins sales reaching 48,500.

Holdings in the world’s largest gold backed exchange traded fund the SPDR Gold Trust, increased by 1.4% over the last two days to 796 metric tons according to data released by Bloomberg. This increase represents the biggest two rise since November ...

2 Jul 2014, 10:42 a.m.
Adam Pike

According to data compiled by Deutsche Bank silver was the best performing asset in June with gold coming a close second. Silver increased by a staggering 12.5% and gold rose by an impressive 6%.

Agriculture commodities performed particularly badly with wheat down over 10% and corn down 8%. The S&P Share index rose 0.69% during the month and here in the UK the FTSE 100 increased by a mere 0.06%.

2 Jul 2014, 10:42 a.m.
Victoria Hewitt-Marsh

The gold price climbed to a three month high yesterday as the U.S. dollar weakened and escalating violence in Iraq boosted gold’s appeal as the ultimate safe haven asset. The gold price has now risen for the third consecutive week.

On Sunday a number of Iraqi units arrived in the northern city of Tikrit with the objective of retaking the city from Sunni militants. According to Reuters the battle has now entered the second day.

Whilst in the Ukraine the latest truce was broken when pro-Russian fighters battled with Ukrainian forces in the eastern city of Slavansk.

Yesterday the dollar fell to a ...

1 Jul 2014, 10:26 a.m.
Duncan Richardson