EuropeStay updated with Business News, Pakistan news, Current world news and latest world news with Business Recorder..http://www.brecorder.com/markets/commodities/europe.htmlTue, 30 Sep 2014 10:08:43 +0000SRA Framework 2.0en-gbGold edges down as strong dollar outweighs weak stockshttp://www.brecorder.com/markets/commodities/europe/197874-gold-edges-down-as-strong-dollar-outweighs-weak-stocks.htmlhttp://www.brecorder.com/markets/commodities/europe/197874-gold-edges-down-as-strong-dollar-outweighs-weak-stocks.htmlimageLONDON: Gold fell on Monday as downward pressure from a strong dollar outweighed support from unrest in Hong Kong, which hit global shares and led to some demand for the metal.

Spot gold was down 0.2 percent to $1,217.10 an ounce by 1422 GMT, while US gold futures gained $2.30 to $1,217.60 an ounce. Cash prices had reached a nine-month low of $1,206.85 on Thursday, before recovering slightly.

The dollar was unchanged against a basket of major currencies and still close to a four-year peak hit earlier in the day as the market looked ahead to a series of important economic data, culminating in the release on Friday of US September non-farm payrolls.

The bigger impact on gold prices could still come from US data as market players seek to gauge the strength of the economy and its impact on Federal Reserve policy.

Strong economic data could prompt the US central bank to raise interest rates faster and sooner than expected, which could boost the dollar and hurt non-interest-bearing bullion.

"There is some consolidation going on now, and $1,220 or just below that appears to be something of a support level, the market is currently in wait-and-see mode with the big data releases later this week," Mitsubishi Corp strategist Jonathan Butler said.

"It's hard to see any major upside from here. From a macro point of view, the attention is pretty much focused on the strength of the US economy and the dollar." On Monday, the pressure on gold from a broadly strong dollar was mitigated by a fall in European and US equities after Hong Kong riot police advanced on pro-democracy protesters in the worst unrest since China took over the former British colony two decades ago.

Gold is traditionally seen as an alternative investment during times of political instability. Unrest in Hong Kong, however, also could hit retail sales in the region, a hot spot for tourists from mainland China, especially during the one-week National Day holiday that begins on Wednesday, bullion dealers said.

"There will definitely be some impact on gold retail sales," said Dick Poon, general manager of refiner and dealer Heraeus Metals in Hong Kong. "Usually there are a lot of Chinese tourists that come to Hong Kong for the holiday and end up buying jewellery, but this time they might be turned off by the protests." China is the world's biggest buyer of gold, and a drop in consumer demand there could undermine any rally in gold prices.

As a gauge of wider investor sentiment, holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 1.20 tonnes to their lowest since December 2008 at 772.25 tonnes on Friday.

Hedge funds and money managers cut their bullish futures and option bets in gold to their smallest since January in the week to Sept. 23, the Commodity Futures Trading Commission said on Friday.

Among other precious metals, silver fell 0.9 percent to $17.46 an ounce, just above a four-year low of $17.30 hit on Sept. 22.

Platinum was unchanged at $1,297.00 an ounce, after earlier hitting its lowest since June 2013 at $1,289.90. Palladium gained 1.2 percent at $781.50 an ounce.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeMon, 29 Sep 2014 16:01:04 +0000
Copper steadies along with dollar, nickel slideshttp://www.brecorder.com/markets/commodities/europe/197866-copper-steadies-along-with-dollar-nickel-slides.htmlhttp://www.brecorder.com/markets/commodities/europe/197866-copper-steadies-along-with-dollar-nickel-slides.htmlimageLONDON: Copper prices steadied on Monday, after earlier touching their lowest level in almost three months, as the dollar pulled back from an earlier four-year high against a basket of currencies.

Nickel slid as inventories piled up to another record high.

Benchmark copper on the London Metal Exchange (LME) was up 0.35 percent at $6,740 by 1449 GMT after falling to a session low of $6,666 a tonne, its weakest since June 16.

The dollar was still near multi-year highs against the yen, euro and a basket of currencies. After a three-month rally, the dollar index has gained more than 7 percent this year. A buoyant dollar puts pressure on commodities priced in the US currency, making them more expensive for buyers outside of the United States. "I strongly think that the dollar will remain strong and this is going to keep the pressure on the demand side for metals," said Naeem Aslam, chief market analyst at Ava Trade.

A strong reading of US non-farm payrolls data due on Friday could help add to speculation about when the United States will start to raise interest rates and help boost the dollar, Aslam said.

"A stronger number on Friday could push the dollar further higher."

On Monday, US data was mixed as consumer spending rose slightly more than forecast in August, while US pending home sales fell by more than expected. CHINA DEMAND Also weighing on metals prices were concerns about the outlook for demand from China, which consumes as much as 40 percent of global refined copper, after data showed industrial profits fell 0.6 percent, reversing July's 13.5 percent rise.

But the big figure this week - an official reading on China's factory sector growth on Wednesday - is expected to show that growth probably steadied in September as factory orders held up, providing some welcome relief for those who worry the Chinese economy is quickly losing steam. Hedge funds and money managers switched the copper market into a net short position in the week to Sept. 23, the Commodity Futures Trading Commission said on Friday.

"There is growing pessimism among speculative financial investors, who built up considerable net short positions in copper again in the week to 23 September," Commerzbank analysts said in a note.

In other metals, benchmark nickel fell 1.6 percent to $16,702 a tonne following another inflow of inventories and after closing clearly below the 200-day moving average on Friday for the first time since February, which sparked chart-based selling.

"LME stocks surged higher this morning, underlining the availability of refined metal," analyst Leon Westgate at Standard Bank said in a note. LME nickel inventories rose by 5,370 tonnes on Monday to a record high of 353,340 tonnes.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeMon, 29 Sep 2014 15:44:14 +0000
Russia's wheat prices fall, pressured by global markethttp://www.brecorder.com/markets/commodities/europe/197812-russias-wheat-prices-fall-pressured-by-global-market.htmlhttp://www.brecorder.com/markets/commodities/europe/197812-russias-wheat-prices-fall-pressured-by-global-market.htmlimageMOSCOW: Russian wheat export prices fell last week and are expected to continue declining this week as local traders seek to stay competitive with the low prices of major global rivals, analysts said on Monday.

Russia, one of the world's largest wheat exporters, has been less competitive in its traditional export markets in recent weeks due to strong domestic demand. Its prices have been relatively high despite a near record harvest and weakening of the rouble. "This time Russian wheat was not able to ignore a new wave of sales on global markets," Russia's SovEcon, an agriculture consultancy, said in a note. November wheat futures in Paris last week touched their weakest level since July 2010.

SovEcon pegged free-on-board (FOB) prices for Russian wheat with 12.5 percent protein content in deep-water ports at $237 per tonne, down $8.50 on the week. In shallow-water ports prices were down $3.50 at $215 per tonne, it said.

Russia's September grain exports are likely to reach 3.7 million tonnes, down from a previously expected 4.2 million tonnes, said Dmitry Rylko, the head of IKAR, another agriculture consultancy. Russian prices for wheat fell to $236 per tonne at the end of last week from $240 per tonne a week ago, according to IKAR.

Its quote was on an FOB basis seen in the Black Sea at the end of last week. "Partially it was caused by a weather factor: there were storms in the Black Sea. But there was also some cooling in demand," Rylko said. Since the start of September, Russia has shipped about 3 million tonnes of grain to customers, including the major consumers of its wheat in North Africa and the Middle East.

SovEcon also expects September grain exports of as much as 3.7 million tonnes after a record 4.6 million tonnes in August.

A week ago IKAR said that to be competitive with French and US origins in Egypt's tenders, Russian FOB Black Sea prices for wheat would have to decline to $230-231 per tonne.

There is a tendency for a further price decline in Russia's domestic market, IKAR said on Monday, adding that state interventions, the buying of grain on the market to replenish stocks, are unlikely to be large, because domestic prices are still high.

Russia's state grain interventions are due to start on Sept. 30 and are expected to be focused first of all on Crimea region, which the Kremlin annexed from Ukraine in early 2014 and which is unable to export most of its crop due to legal issues.

In the domestic sunflower seed market, SovEcon said prices rose 75 roubles to 11,875 roubles ($300) as prospects for the crop had been worsening, while FOB Black Sea prices for crude sunflower oil rose by $10 to $770 a tonne.

Russia has already harvested 4.5 million tonnes of the oil seeds from 40 percent of the planned area, up from 2.1 million tonnes a year ago.

However, yields are down at 1.62 tonnes per hectare compared with 2.04 a year ago. SovEcon has previously expected the 2014 sunflower seed crop at 8.8 million tonnes. IKAR's white sugar price index for Russia's south was down $4 at $621 per tonne compared with a week earlier.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeMon, 29 Sep 2014 13:44:28 +0000
Gold falls on strong dollar, heads for 4th week of losseshttp://www.brecorder.com/markets/commodities/europe/197378-gold-falls-on-strong-dollar-heads-for-4th-week-of-losses.htmlhttp://www.brecorder.com/markets/commodities/europe/197378-gold-falls-on-strong-dollar-heads-for-4th-week-of-losses.htmlimageLONDON: Gold dropped on Friday, heading for its fourth weekly loss in a row, as investors remained wary that a strong dollar and rebounding shares could drive prices through an important support level at $1,200 an ounce. Spot gold was down 0.7 percent at $1,214.95 an ounce by 1431 GMT, while US gold futures lost $7.40 to $1,214.50 an ounce.

The metal fell to a nine-month low of $1,206.85 on Thursday, before rebounding due to a sharp selloff in US equities, which prompted investors to seek refuge in perceived safer assets such as bullion.

"Today we are seeing the dollar and stock markets pressuring precious metals," MKS SA senior vice president Bernard Sin said.

"The market is getting a little bit nervous because we are floating just above this psychological level of $1,200 and it is important that we don't close below it today because a lot of stop losses would be triggered there." European shares rebounded from a one-month low hit earlier on Friday, while US stocks rose as data showed the country's economy grew at its fastest pace in more than two years in the second quarter.

The Commerce Department raised its estimate of gross domestic product to show the economy expanded at a 4.6 percent annual rate, in line with expectations and the best performance since the fourth quarter of 2011. Strong data lifted the dollar against a basket of major currencies, putting the US unit on track for an 11th week of gains.

"Gold could fall below $1,200, but I maintain a cautious optimism that it won't break below the $1,180 area," Saxo Bank manager Ole Hansen said.

"The dollar has been strengthening on the weak economic outlook for Europe and relatively hawkish expectations for interest rates in the US, and in that sense the jobs report next week is really important."

The bigger impact on gold prices could still come from economic data, with US September nonfarm payrolls figures due on Oct. 3.

Markets are eyeing more US releases to gauge the strength of the economy and its impact on Federal Reserve policy. Strong economic figures could prompt the US central bank to raise interest rates faster and sooner than expected, which could hurt non-interest-bearing bullion and boost the dollar further.

Physical buying in Asia, the top gold-consuming region, has increased in recent days as prices have slid towards January's lows, but the pickup has not been robust, because many expect further price drops.

India should soon see a demand boost with the beginning of the wedding and festival season.

China could also see an uptick as it goes on a week-long holiday from Oct. 1.

Among other precious metals, silver rose 0.2 percent to $17.51 an ounce.

Platinum fell 0.4 percent to $1,300.49 an ounce, not far from its lowest since June 2013 at $1,295.25 hit on Thursday. Palladium was down 1.1 percent at $791.47 an ounce, having fallen to its lowest since late April at $786.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeFri, 26 Sep 2014 15:37:24 +0000
ICO sees coffee market in deficit this season and nexthttp://www.brecorder.com/markets/commodities/europe/197346-ico-sees-coffee-market-in-deficit-this-season-and-next.htmlhttp://www.brecorder.com/markets/commodities/europe/197346-ico-sees-coffee-market-in-deficit-this-season-and-next.htmlimageLONDON: Global coffee production is expected to fall short of demand in both this crop year and next, the International Coffee Organization's head of operations said on Friday.

Mauricio Galindo told a news conference that the ICO expected a deficit in arabica coffee of some 4 to 5 million 60-kg bags in the current season to March 2015.

A drought in Brazil earlier this year has eroded production prospects in the world's top producer, and stock levels could fall further if Brazil continues exporting at the same high rate as in recent months, ICO officials said.

Exports from Brazil have remained consistently high since the beginning of the crop year in April, well above monthly levels in the previous two crop years, an ICO statement said.

"These higher export levels, compared with the lower crop expected in crop year 2014/15, suggest that stocks in Brazil will be heavily drawn down this year," it said.

"This will put extra strain on supply in 2015, given the limited capacity of other origins to fill the gap."

Roberio Oliveira Silva, executive director of the London-based ICO, said it was too early for the international body to forecast Brazilian coffee output in 2015/16, after forecasting production of 44.57 million bags in 2014/15.

"We have to wait for the government to send us the estimate," he said.

Analyst F.O. Licht said on Friday its working estimate for Brazil's coffee output in 2015/16 was 43 million 60-kg bags, down from a forecast of 46 million bags in 2014/15, reflecting the impact of drought earlier this year.

Licht forecast global coffee production of 145.5 million 60-kg bags in 2014/15, down from 152.9 million in 2013/14.

According to Licht, premature rains in Brazil in July had compounded the earlier drought problems by triggering premature flowering in some areas in August, which has since been followed by a lack of rain.

Galindo said coffee leaf rust in Central America was "roughly under control" after a marginal drop in production in the region.

He said coffee output in Central America was down 2 percent year-on-year in 2013/14 after a slide of 18 percent in 2012/13.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeFri, 26 Sep 2014 14:01:44 +0000
Gold set to snap 3-week losing streak, dollar weighshttp://www.brecorder.com/markets/commodities/europe/197293-gold-set-to-snap-3-week-losing-streak-dollar-weighs.htmlhttp://www.brecorder.com/markets/commodities/europe/197293-gold-set-to-snap-3-week-losing-streak-dollar-weighs.htmlimageLONDON: Gold edged up on Friday, looking set to snap a three-week losing streak, as equity markets slipped, but investors remained wary that a strong dollar could drive prices down again to break an important support level of $1,200 an ounce.

Spot gold was up 0.1 percent at $1,223.10 an ounce by 0959 GMT and on track for a 0.6 percent weekly gain. US gold futures gained $1.50 to $1,223.50 an ounce.

The metal fell to a nine-month low of $1,206.85 on Thursday, before rebounding due to a sharp sell-off in US equities, which prompted investors to seek refuge in safer assets such as bullion.

European shares slipped to a new one-month low on Friday following losses in US and Asian stocks, while the dollar held near a four-year high against a basket of major currencies and headed for an 11th week of gains.

"We received a boost yesterday from low bond yields and falling stocks, but it is the dollar that holds the key and at the moment it's really a question of how strong the bullish sentiment towards the dollar is," Saxo Bank manager Ole Hansen said.

"Gold could fall below $1,200, but I maintain a cautious optimism that it won't break below the $1,180 area," he added. "The dollar has been strengthening on the weak economic outlook for Europe and relatively hawkish expectations for interest rates in the US, and in that sense the jobs report next week is really important."

The bigger impact on gold prices could still come from economic data, with US September non-farm payrolls due on Oct. 3. Markets are eyeing more US releases to gauge the strength of the economy and its impact on the Federal Reserve policy.

Strong economic figures could prompt the US central bank to raise interest rates faster and sooner than expected, which could hurt non-interest-bearing bullion and boost the dollar further.

Physical buying in Asia, the top gold consuming region, has increased in recent days as prices have slid towards January's lows, but the pickup has not been robust, because many expect further price drops.

"The stronger dollar has dampened interest for gold," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong.

"Physical demand could help gold hold above $1,200, but that is not strong enough to provide support," Leung said.

India should soon see a demand boost with the beginning of the wedding and festival season. China could also see an uptick as it goes on a week-long holiday from Oct. 1.

Among other precious metals, silver rose 0.7 percent to $17.59 an ounce.

Platinum was up 0.2 percent at $1,308.74 an ounce, having fallen to its lowest since June 2013 at $1,295.25 on Thursday, and palladium gained 0.3 percent to $802.50 an ounce.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeFri, 26 Sep 2014 12:32:13 +0000
Copper up but eyes weekly loss on expected supply surgehttp://www.brecorder.com/markets/commodities/europe/197291-copper-up-but-eyes-weekly-loss-on-expected-supply-surge.htmlhttp://www.brecorder.com/markets/commodities/europe/197291-copper-up-but-eyes-weekly-loss-on-expected-supply-surge.htmlimageLONDON: Copper rose on Friday on near term supply tightness, but remained near recent three-month lows on worries over an expected supply surge and weak demand from top consumer China.

Indicating tight near term supply, cash copper traded at a premium of $46 a tonne to the three month price - not far off a recent high of $53 a tonne, which was the widest spread since June.

For the first six months of the year, the market was in a 526,000 tonnes deficit compared with a 139,000 tonnes surplus in the same period a year earlier, the International Copper Study Group (ICSG) said this week.

But investors are expecting a surge of copper supply going forward. A Reuters poll in July forecast a copper market surplus of 226,000 tonnes for 2014 as a whole.

"The time spreads reflect a market where stocks are low but the expectations is that there is going to be a big increase in supply," said Gayle Berry, metals strategist at Jefferies Bache.

Three-month copper on the London Metal Exchange edged up by 0.47 percent to $6,726.25 a tonne by 1001 GMT, but is set to notch up a weekly decline of 1.6 percent, having sunk to the lowest since June 17 at $6,676.75 a tonne on Thursday.

Limiting gains in copper were concerns about demand in China, which consumes some 45 percent of the world's copper.

China's economy got off to a weak start this year as first-quarter growth cooled to a six-quarter low of 7.4 percent.

Beijing responded with a flurry of stimulus measures that pushed the pace up slightly to 7.5 percent in the second quarter, but soft July and August data suggest the boost is rapidly waning.

In the wider markets, the dollar rose against the yen and several other major currencies on Friday, on track for an 11th straight weekly gain that extends its longest winning streak since its 1971 free float.

A strong dollar makes dollar-priced metals costlier for European and other non-US investors.

In other metals, aluminium was up 0.67 percent at $1,963 a tonne, having hit its lowest since July earlier this week.

Strong aluminium prices - they hit the highest since February 2013 at the end of August - have prompted some Chinese smelters to abandon production cutbacks, chipping away at what was expected to be the first global deficit after years of oversupply.

Tin edged up 0.24 percent to $20,800 a tonne, having hit its lowest in just over a year on Thursday.

"The tin price has been conspicuously weak of late.

We believe that speculative forces are largely to blame. Since the fundamental picture is better than current sentiment, we expect to see prices recover," said Commerzbank in a note.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeFri, 26 Sep 2014 12:30:32 +0000
Wheat falls on improving supply outlook, soy also lowerhttp://www.brecorder.com/markets/commodities/europe/197288-wheat-falls-on-improving-supply-outlook-soy-also-lower.htmlhttp://www.brecorder.com/markets/commodities/europe/197288-wheat-falls-on-improving-supply-outlook-soy-also-lower.htmlimageLONDON: Chicago wheat prices fell on Friday towards more than four-year lows set the previous day, with the prospect of a record global crop this season keeping markets on the defensive.

Soybeans prices also weakened for a second day while corn was largely unchanged near its lowest in four years as dry weather across the US Midwest gave farmers an opportunity to accelerate the pace of harvest.

December wheat on the Chicago Board of Trade fell 0.5 percent to $4.71-3/4 a bushel by 1022 GMT.

The front month set a more than four-year low of $4.66-1/4 a bushel on Thursday.

The International Grains Council on Thursday raised its forecast for the 2014/15 global wheat crop to a record level due to an improved outlook in the European Union and Ukraine, adding to a picture of ample supply.

An expected drop in production in number four exporter Australia failed to stem concern about excess supplies. Australia's wheat production is expected to drop 11 percent this year as a dry spring in some of the country's key producing states curbs yields, a Reuters survey showed.

"This in itself is hardly likely to be enough for the wheat price to make any sort of noticeable recovery, for the plentiful crops in the northern hemisphere, where harvesting is almost complete, have caused supply to grow considerably," Commerzbank said in a market note.

November wheat futures in Paris fell 1.25 euros or 0.8 percent to 149.50 euros, drifting down towards a more than four-year low of 148.50 euros set on Monday.

SOY SLIPS CBOT

soybean prices were lower with November off 0.5 percent at $9.18-1/2 a bushel while CBOT December corn was unchanged at $3.26 a bushel.

"There was bit of a pause a few days ago but it seems like the decline is continuing again," said Phin Ziebell, agribusiness economist at National Australia Bank in Sydney. "We are seeing reports of favourable harvest conditions in the US Midwest with only light showers."

Weekly soybean export sales data released by the US Department of Agriculture on Thursday was near the high end of a range of trade estimates at 2.566 million tonnes, mostly to top importer China.

But the market had absorbed most of that news last week when the USDA confirmed large Chinese purchases via its daily reporting system.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui)EuropeFri, 26 Sep 2014 12:29:24 +0000
Copper, base metals retreat on stronger dollarhttp://www.brecorder.com/markets/commodities/europe/197134-copper-base-metals-retreat-on-stronger-dollar.htmlhttp://www.brecorder.com/markets/commodities/europe/197134-copper-base-metals-retreat-on-stronger-dollar.htmlimageLONDON: Copper and base metals stumbled on Thursday, and some analysts expected more losses, partly because of a strong dollar and worries that weak global growth will curb demand.

The dollar climbed to a fresh four-year high against a basket of currencies, while the euro fell to its lowest since November 2012.

A buoyant dollar makes commodities priced in the U.S. currency more expensive to buyers outside the United States.

"I see more downside and it's not just metals. It's across the sector vulnerability coming from the stronger dollar and from what the Fed is likely to be saying and doing over the coming months," analyst Robin Bhar at Societe Generale said.

"When we look at demand as we go into the fourth quarter, there are a few worries. Yes the U.S. is doing fine, but China, Japan and the euro zone are not really getting much growth."

Three-month copper on the London Metal Exchange retreated 0.5 percent to $6,706.50 a tonne by 0952 GMT after trading as high as $6,766.50 earlier. The contract dipped to its lowest since June 19 at $6,686 a tonne in the previous session, before closing up 0.4 percent.

Traders attributed the gains during Asian trading to U.S. and European central bankers' comments that suggested they would maintain policies to stimulate growth, soothing concerns over growing fragility in the global economy.

SHORT COPPER?

Concerns over fundamental weakness in the copper market are being overplayed, according to Citi analysts who pointed to positive signs of Chinese demand in a note, such as rising power cable output in both July and August.

UBS commodities analyst Daniel Morgan was more cautious.

We're modestly bearish on copper for the fourth quarter," he said "The driver for that is that there's a bit of supply surge that's happening in 2014 and 2015 ."

Bhar was also bearish, suggesting investors go short copper, which he expects to average $6,500 in the first quarter of next year, versus long positions in other metals that have a more robust supply-demand outlook.

"We could go retest the recent low (in copper), which was around $6,300 in April, and we could briefly move below the $6,000 level if there's a big increase in stocks."

In other metals, LME nickel shed 0.8 percent to $17,260 a tonne after dropping to the lowest price in more than five months on Tuesday.

Investors piled into nickel earlier in the year, sending prices to a peak of $21,625 in May, the highest in more than two years, after Indonesia imposed a ban on unprocessed ore exports.

Perth-based Alto Capital research analyst Carey Smith said the price could average $20,000 a tonne next year, 11 percent higher than the average of $18,000 so far in 2014.

"Currently, there are no new large-scale nickel projects coming on stream, and existing or mooted export bans will only add to the pace at which supply and demand pressures must invariably spike a price rise," he said.

Copyright Reuters, 2014

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imad_kueconomist@yahoo.com (Imaduddin)EuropeThu, 25 Sep 2014 12:32:22 +0000
Gold drops to 9-month low as dollar hits 4-year peakhttp://www.brecorder.com/markets/commodities/europe/197132-gold-drops-to-9-month-low-as-dollar-hits-4-year-peak.htmlhttp://www.brecorder.com/markets/commodities/europe/197132-gold-drops-to-9-month-low-as-dollar-hits-4-year-peak.htmlimageLONDON: Gold prices fell to a nine-month low on Thursday and other precious metals slid as the dollar rose to four-year highs against a basket of currencies and stock markets strengthened.

Platinum fell to its lowest since June last year, sliding below $1,300 an ounce, and silver and palladium also tumbled.

Spot gold hit a low of $1,206.85 an ounce, its weakest since Jan. 2, and was down 0.5 percent at $1,210.30 an ounce at 1001 GMT. U.S. gold futures for December delivery were down $8.70 an ounce at $1,210.80.

A run of upbeat U.S. data has highlighted the diverging economic outlook for the euro zone and the United States. Expectations are growing that the Federal Reserve will begin tightening rates early next year.

The prospect of diverging monetary policy between the Fed and the European Central Bank sent the euro to a 22-month low against the dollar.

U.S. policy and currency moves are the "one and only driver" of the gold market at present, VTB Capital analyst Andrey Kryuchenkov said.

"A stronger greenback and little or no inflation for the major economies remain the key threat to bullion's upside as we head into 2015," he said.

"Notably ... the world's largest ETF provider was still reporting ETF outflows following a pronounced plunge in its physical book last week," he added. "The physical interest in Asia remains anaemic, and we still see little chance for a sustained price rebound without any consumer buying here."

Holdings of gold exchange-traded funds, popular investment vehicles which issue securities backed by bullion, have fallen by close to a million ounces this month, their biggest monthly outflow this year, according to Reuters data.

Investors will be watching more U.S. data due later on Thursday, including durable goods orders for August, to gauge the strength of the world's largest economy and the implications for the Federal Reserve's monetary policy and the dollar.

PHYSICAL DEMAND SUBDUED

Physical demand has been subdued this year after a record 2013, when prices slumped by 28 percent. Buying of physical gold in top market China was light on Wednesday, traders said, even ahead of the Golden Week holiday next week.

China's net gold imports from main conduit Hong Kong slid to their lowest since May 2011 in August due to adequate stocks from earlier purchases and as consumer demand remained weak, data showed on Thursday.

News of central bank purchases failed to support gold. Russia added to its gold holdings in August, while Kazakhstan raised its holdings by nearly 800,000 ounces.

Among other precious metals, spot silver was down 0.9 percent at $17.50 an ounce, spot platinum was down 0.7 percent at $1,304.50 an ounce, and spot palladium was down 1.7 percent at $800.25 an ounce.

Platinum earlier fell to its lowest since June 2013 at $1,295.25 an ounce, while palladium slid to its lowest since late April at $792 an ounce.

The chief executive of Russia's Norilsk Nickel said on Wednesday the company, the world's largest palladium producer, and a group of private investors were in talks to buy palladium worth up to $2 billion from the country's central bank.

"With 2.4 million ounces involved, close to one-year's worth of Russian mine supply, this is a bearish development - should it materialize," UBS said in a note. "The uncertainly surrounding it alone should push palladium lower."

Copyright Reuters, 2014

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imad_kueconomist@yahoo.com (Imaduddin)EuropeThu, 25 Sep 2014 12:30:29 +0000