Malaysia Gold Investment

Gold just rush back to 1,400 level and I think this price will carry to next year 2011. For me gold will be a good investment in year 2011 as US may likely to print more money and food price may fly sky high. I past history, if you price food with gold value, food price never go up.

As we know US is flowing the market with they printed money next year. This money will expected to result in inflation so Gold price sure will be up like most of the commodities. China and India is the biggest Gold buyer in 2010 and with all the Gold in hand they can change world currency, but US may not easily give up they dollar out from world currency because if this happen they money printing plan will be no value. As US flow more money into money market, the value will be drop and Gold value will be up so for me I think using EPF money to buy gold investment fund will be likely to bring us a good profit in year 2011.

After another day of sideways trading on Wednesday, gold rallied overnight, helped by a weaker dollar. The metal failed to break higher however as selling activity intensified above $1,390. The selling pressure has blunted its advance and seen gold give back most of its overnight gains heading into the afternoon.

Gold appears to be stuck in the doldrums for the moment, with yesterday’s lethargic and sideways trading continuing into Tuesday. Gold is drifting sideways heading into Tuesday afternoon, trading in a narrow range and on the back of thin volumes. Key resistance at $1,390 is proving to be a fairly solid barrier for the moment, with the metal lacking the momentum, and the market lacking the conviction to push prices significantly higher. With little in the way of economic data this afternoon, direction will likely come from the equity markets, the dollar and from technical trading signals. The holiday period will result in thinner trading conditions over the coming weeks, suggesting the market will likely veer from long periods of incredibly dull trading, to bursts of activity and volatile price movement as sporadic business gets done.

Gold had a steady, but rather unexciting end to the week, with dip-buying preventing the metal from falling off a cliff as the euro collapsed, albeit with the stronger dollar also capping the upside. Renewed concerns over the Eurozone debt crisis have seen gold remain well supported this morning, with the yellow metal climbing back above $1,380/oz. Gold support and resistance is seen at $1,365 and $1,388 respectively.

Profit-taking on the week’s recent rally saw gold lose considerable ground on Thursday and Friday. The move down was exacerbated by a strengthening dollar, as sovereign debt woes plagued the euro and as better-than-expected jobless claims figures bolstered confidence in the US economy. Yesterday’s dip in gold was mirrored by the rest of the precious metals complex, although platinum’s move was not as extreme, due perhaps to a lack of recent speculative activity, but also the relative stability seen in the base metals. Overnight, lower prices prompted some bargain hunting activity, led by the physical markets. Speculative action in the form of short-covering has also lent some support, while the agreement by European Union leaders, to replace the current emergency rescue fund with a permanent crisis finance program, has renewed confidence in the euro. The consequent dollar weakness added to the upward momentum in precious metals prices this morning, though the metals are again back unde...

10-year UST yields are now close to 3.5%. 10-year breakeven inflation in the US, as implied by the US bond market, jumped to 2.3% this week - its highest level since May. This leaves the 10-year real interest rate still at a very low 1.2%. As long as real interest rates are low gold should find buying support. In the gold physical market buying remains absent. Scrap and other selling are outpacing buying interest. While the physical market should support gold on dips, it is clear the physical market is unlikely to be the driving factor which pushes gold to a new (sustainable) trading range above $1,420. It appears risk appetite is slowly being toned down as we head towards year-end. The market seems more than willing to take profit on rallies rather than chase the price higher. We’ve seen the VIX index edge back towards the 18% level after falling to 16.8% on Monday which was its lowest level since April this year. Gold support is at $1,374 and $1,367. Resistance is at $1,392 and $1,40...

Yesterday saw the precious metals move higher ahead of the FOMC statement as dollar weakness combined with safe-haven demand. However, this support soon evaporated as the Fed maintained its commitment to $600bn of treasury purchases. Unsurprisingly, the FOMC reiterated that the economic recovery, while continuing, is still insufficient to reduce unemployment. Better-than-expected US retail sales figures also bolstered confidence in the economy on Tuesday, reducing the safe-haven appeal of precious metals, while steady CPI data and solid manufacturing figures this afternoon have also eroded support. Meanwhile, fears of sovereign debt contagion within the Eurozone have resurfaced, Belgium the main culprit this time, which has seen the euro come under further pressure against the dollar. Gold support is at $1,382 and $1,380. Resistance is at $1,406 and $1,415.

Breakeven inflation in the US, as implied by the US bond market, is edging higher. 2-year breakeven inflation is now at 1.02%, up from 0.65% less than a month ago. The Fed wants higher inflation. However, US unemployment is also edging higher which the Fed doesn’t want. While higher long-term rates are negative for precious metals and gold specifically, in relative terms real interest rates remain very low and monetary conditions very accommodative. We believe, using the Taylor rule as guidance, inflation must be close to 2% and unemployment closer to 7% before the Fed would even consider tighter monetary policy. In the mean time, gold especially should find good support. In the gold physical market buying remains absent. In fact, scrap and other selling are still outpacing buying interest. But as pointed out in our physical flow note last week, the physical market appears to start buying at "higher lows" than before. We believe gold is still a buy on dips. Gold support is at...

As anticipated, Gold lost ground ahead of the weekend close. After China’s move to raise bank’s reserve requirements investors began to move out of commodities in anticipation of the central bank raising interest rates over the weekend. However, this further tightening of monetary policy did not materialise, leaving many investors, particularly in Asia, caught short on their bets for a rate hike. Short covering has contributed to a rally in Gold. Nevertheless, given that Chinese consumer inflation figures released over the weekend reached a 28-month high, the threat that the authorities will move to curb inflationary pressures remains. This was further enforced by a statement from the Central Economic Work Conference, affirming a commitment to a more “prudent” approach to monetary policy. Consequently, we expect more dips as markets react to developments on this front. As highlighted on Friday, we believe that Chinese consumer prices will peak within the next few months. As such, the c...

Precious metal prices are steady. Gold is finding good support around the $1,380 level, since last week US treasury yields has risen sharply. The move in the 10-year UST yield, from 2.90% last week to 3.25% today, was rather violent for such a deep and liquid market. Since break-even inflation in the US (as derived from the bond market) remains largely unchanged, implied real interest rates in the US has also moved higher in recent days. The 10-year implied real interest rate in the US is now at 1%, up from 0.60% at the end of November. A rise in real interest rates is bearish for gold and seems to be capping upside at the moment. However, despite the latest rise in US real interest rates, the fact that the level of real rates remains low, still makes gold investment attractive. As a result we believe real interest rates will have to rise much higher before any long term negative impact will be seen on gold investment. Gold support is at $1,367 and $1,352. Resistance is at $1,400 and $...

Gold continues to edge higher in both dollar and euro-terms. We still favour euro-gold to outperform dollar-gold in the next few weeks. Investment demand is still driven by Euro-zone debt problems which remain at the forefront – the 5y CDS for Portugal, Spain and Italy is still rising. Gold above $1,385 has attracted physical metal selling which may provide some resistance as we head towards $1,400. We expect physical selling to turn into buying should gold decline towards $1,360 again. We continue to expect gold physical demand to prevail on dips into January - Indian demand should remain positive until at least mid-December on the back of wedding season. We also still have the festive seasons in the Western Hemisphere as well as Chinese New Year. In 2011 Chinese New Year is on 3 February.

Disappointing US non-farm payrolls figures on Friday saw investors flock to the relative safety of precious metals. Non-farm payrolls rose only 39k in November, a far cry from expectations of a 150k increase. In addition, the unemployment rate unexpectedly increased to 9.8%. The release saw the trade-weighted dollar drop by the most in six weeks, intensifying the rally in precious metals, with silver and palladium leading the charge. Comments made by Fed Chairman Bernanke, in an interview aired on US television last night, are largely bullish for precious metals. He mentioned the possibility that the Fed might expand QEII even further (beyond the original $600bn announced), citing stubbornly high unemployment as a threat to the sustainability of the US economic recovery. More liquidity means a further boost for precious metals, especially gold, as well as a weaker dollar. Gold support is at $1,392 and $1,373. Resistance is at $1,425 and $1,437.

The Shanghai Gold Exchange indicated China imported 210 tonnes in the first 10 months of 2010. During the same period in 2009, China imported 45 tonnes of gold. We believe China’s gold production in 2010 should be close 350 tonnes. Legally gold is not allowed to be exported out of China. If the pace of imports during the first 10 months continues in November and December 2010, gold imports into China should be close 250 tonnes. This puts China’s 2010 implied gold demand at 600 tonnes. We believe the rise in gold demand is mainly on the back of increased jewellery and investment demand (industrial demand remains small). We perform some calculations to put this rise in gold demand in perspective and determine in which sector demand growth in China lies. During the first 10 months of 2010 China’s retail sales of gold and silver jewellery averaged RMB 10.6bn per month. In 2009 retail sales of gold and silver averaged only RMB6.63bn per month. The 2010 retail sales figures are inflated by r...

Gold is closing in on $1,400. With gold at these levels scraps gold is coming to the market once again. We expect selling from the physical market to provide resistance at these levels. The Shanghai Gold Exchange indicated China imported 210 tonnes in the first 10 months of 2010. During the same period in 2009 only 45 tonnes of gold was imported. We believe China’s gold production in 2010 should be around 350 tonnes. Gold exports are not allowed to be exported out of China. If the pace of imports we saw during the first 10 months continues in November and December 2010, gold imports into China should be around 250 tonnes. This puts China’s 2010 implied gold demand at 600 tonnes. The same calculation puts China’s 2009 implied demand at 346 tonnes. Therefore, China’s gold demand in 2010 looks set to increase 254 tonnes or 74%. We note that there is likely to be illegal gold exports and imports from and to China. This would distort the actual gold numbers for China. However, the trend is ...

Gold continues to edge higher in both dollar and euro-terms. We still favour euro-gold to outperform dollar-gold in the next few weeks. Investment demand is still driven by Euro-zone debt problems which remain at the forefront – the 5y CDS for Portugal, Spain and Italy is still rising. Gold above $1,385 has attracted physical metal selling which may provide some resistance as we head towards $1,400. We expect physical selling to turn into buying should gold decline towards $1,360 again. We continue to expect gold physical demand to prevail on dips into January - Indian demand should remain positive until at least mid-December on the back of wedding season. We also still have the festive seasons in the Western Hemisphere as well as Chinese New Year. In 2011 Chinese New Year is on 3 February.