Malaysia Gold Investment

Malaysia Retail Gold Price Still On RM187/g During CNY

The gold price declined Monday morning, falling alongside stocks and commodities amid speculation that Greece was headed toward default. The price of gold dipped $6.00 to $1,732 per ounce as negotiations between Greece and private bondholders failed to yield an agreement. A second rescue package of €130 billion depends is dependent on a compromise. Meanwhile Portuguese credit-default swaps rose to a new record high of 39.5%, signaling a 71% chance of a default over the next five years. Gold’s strong performance in January has illustrated that the gold has “come roaring back from its latest temporary correction, sending the bears into full withdrawal,” according to Robert Lenzer. The former National Editor and Senior Editor at Forbes Magazine, Lezner discussed the catalysts for gold’s rebound in a recent article on Forbes.com. “Gold, you see, is not a commodity like oil and copper and wheat,” Lezner wrote. “It is rather an alternative currency– one that finds buyers when...

For the first time since mid-November 2011, our Standard Bank Physical Gold Flow Index moved into negative territory yesterday—this indicates that physical market participants have turned net sellers. This lack of physical demand partly explains the inability of gold to make a sustained move beyond the $1,730 level. The lacklustre interest in physical gold can partly be explained by the absence of Far East participants away for the lunar New Year celebrations (China, Singapore, Malaysia and Indonesia). However, as we move into next week it is important to consider the other factors that are currently weighing on physical demand for gold and whether these factors might evaporate when the Far East returns to the market. One of these factors has been increasing scrap scales, especially out of South East Asia. However, compared to historical levels, these sales are not substantial and we don’t expect them to be a significant drag on prices over the coming week. Secondly, while Indian physi...

The gold price held firm near $1,730 per ounce at closing after fourth quarter U.S. GDP growth came in at 2.8%, below the 3.0% consensus estimate among economists. The price of gold hovered in a tight range between $1,718 and $1,728 in overnight trading, while the U.S. dollar stabilized against many of the world’s leading currencies. Silver held near unchanged at $33.60 alongside the gold price, while U.S. equity markets opened modestly lower following the disappointing GDP report. Ole Hansen, senior manager at Saxo Bank, commented that “The strong rally in gold changed what prior to the (Fed) announcement had been a test of gold’s resolve. The Fed statement changed all that, and from thinking that the gold rally potentially only had one year left to run, it could now continue for longer…The ‘off’ button on the printing press has well and truly been taped over.” Barclays Capital analyst Suki Cooper offered a bullish take on the gold price as well, but urged a bit of ca...

The gold price climbed $12.08, or 0.7%, to $1,723.63 per ounce Thursday morning as the yellow metal built on yesterday’s Fed-induced rally. Silver added to its gains alongside the gold price, by $0.27, or 0.8%, to $33.61 per ounce. Equity markets throughout Asia and Europe were largely higher, while U.S. markets looked to open in the black as well. The primary catalyst for yesterday’s gold price strength was the particularly dovish tone emanating from the Federal Open Market Committee (FOMC) meeting. There, the Federal Reserve chose to extend the timeframe for its zero-interest rate policy to late-2014 from mid-2013. Additionally, it introduced new language in the FOMC statement by saying that it intends to maintain a “highly accommodative” monetary policy stance for the foreseeable future. Along with the statement, for the first time the Ben Bernanke-led Federal Reserve released a summary of economic projections from its individual members. In particular, the Fed pr...

Gold and silver prices surged higher alongside after the Federal Reserve extended the time period for its near-zero interest rate policy from mid-2013 to late-2014. The Federal Reserve did not launch a third round of quantitative easing (QE3) at its Federal Open Market Committee (FOMC) meeting today, but did extend the timeframe for near-zero interest rates from mid-2013 to late-2014. In addition, the tone of the Fed statement was a bit more dovish than that from last month’s meeting. Specifically, the latest statement said that “the Committee expects to maintain a highly accommodative stance for monetary policy” – which was language not included in the prior statement. Another key difference was that the one dissenting vote came from a hawkish rather than dovish member. Last month, Charles Evans dissented because he supported “additional policy accommodation.” This time, Jeffrey Lacker “preferred to omit the description of the time period over which economic conditions...

After reaching a six-week high, gold succumbed to profit-taking yesterday. The trend has continued into this morning, with the absence of Far East physical demand (due to Lunar New Year holidays) opening up the metal to further downside. The rest of the Gold complex has followed gold lower, although platinum came under particular pressure from liquidation overnight on TOCOM. It did however rebound quickly, thereafter resuming a more sedate downward trend. Better-than-expected PMI readings out of the Eurozone have also dampened investors enthusiasm for safe-haven assets. The figures showed that the services sectors in both Germany and the Eurozone expanded. German manufacturing grew (analysts expected a contraction), while Eurozone manufacturing did contract, although at a slower pace than expected. Today is the start of the FOMC’s two-day meeting. This will be the first meeting where the Fed will release its projections on the Fed funds rate. Given the strong positive relationship betw...

The gold price climbed $4.00 to $1,671 per ounce Monday morning against the backdrop of a weaker U.S. dollar. Gold prices advanced through their 50-day moving average and have now rallied $108 thus far in 2012. The U.S. Dollar Index fell 0.37 to 79.77, led by a higher euro, which recaptured the 1.30 level against the greenback. Helping to power the gold price was news out of Europe that Italian Prime Minister Monti and European Central Bank President Draghi were working towards doubling the capacity of the European Stability Mechanism (ESM) from €500 billion to €1 trillion. Commenting on the recent gold price ascent, ANZ bank senior commodity strategist Nick Trevethan wrote in a note to clients on Friday that “Gold has had a fairly good run so far this year, maybe this is time to consolidate a little. A pause here would probably be a healthy sign. After that, I think the next move is likely to be up towards $1,680.” Trevethan went on to say that “I think physical flows ma...

The gold price rebounded from earlier losses Friday morning to trade back near unchanged at $1,658 per ounce. The spot price of gold initially fell to $1,644.20 amid profit taking in the yellow metal, but bounced back after a worse than expected report on existing home sales in the U.S. The SPDR Gold Trust (GLD), the world’s largest gold ETF and gold price proxy, recovered from an intra-day low of $159.95 to $161.39 per share. The gold price reacted positively to the last report in a busy week of U.S. economic data. Existing home sales for December increased 5.0% on a month-over-month basis, below the 5.2% consensus estimate among economists. The worse than expected report confirmed comments made earlier this week by Federal Reserve Governor Elizabeth Duke on the challenges that remain in the housing market. “One of the questions that potential buyers or potential investors are looking at is how much inventory is there still to come on the market,” Duke stated. “Such l...

Gold enjoyed a relatively good US session, although momentum did slow in overnight Asia trade. For the most part, the upside was attributable to bolstered investor confidence, owing in part to the IMF announcement that it is planning to extend its lending capacity by $500bn. Despite the US and UK saying that they would not commit to such a move, the market took heart that this would help ease the fiscal problems facing the Eurozone. This renewed confidence has seen markets adopt a cautious risk-on stance, pulling the dollar down and consequently easing downward pressure on precious metals and commodities in general. Another leg of support for gold (and for the other precious metals as they follow) has been the consistently strong physical demand out of China as buyers gear up before the New Year holidays. However, with today the last day of work for many Chinese, this support cannot be relied on over the coming weeks. Unless Indian buying fills the gap, which is unlikely given the rela...

Gold came under pressure yesterday as new highs prompted some profit-taking. The selling gained momentum as Asian participants questioned the sustainability of the recent renewal of confidence in financial markets. However, there was good support evident at the $1,645 level for gold, which limited the losses among the other precious metals. This support seemed to stem largely from Chinese buyers stocking up ahead of the New Year holidays (with tomorrow being the last day of work for many Chinese). Sticking with China, many are anticipating the PBoC to lower reserve requirements by tomorrow. This is also adding to support for Gold, and metals in general. However, as outlined yesterday, we find that historically, changes in the reserve requirement have little bearing on commodity prices over the long term. Therefore, any positive reaction to a lowering of reserve requirements we would deem as knee-jerk, with a downward correction following soon afterwards. This morning we’ve seen gold se...

The gold price surged Tuesday morning, rising $17.05 to $1,661 per ounce. Gold prices climbed above the $1,650 level on speculation that Chinese policy makers were set to implement aggressive monetary accommodation following a weaker than expected gross domestic product figure. GDP in China grew 8.9% in the fourth quarter, the slowest pace in over two years. Investors and traders pushed up the prices of not only gold, but stocks and commodities as well following the news. With regard to the Chinese GDP report, several analysts contended that slower economic growth is likely to continue in the months ahead. Economists at Citigroup wrote in a note to clients that “We expect GDP growth to slow more markedly in the first quarter due to the sharp investment slowdown under way.” At J.P.Morgan, economists predicted that GDP growth will slow to 7.6% in the first quarter of 2012 on a year-over-year basis. If these forecasts materialize, gold prices are likely to benefit from...

The gold price advanced $4.82, or 0.3%, to $1,643.30 per ounce in light-volume trading on Monday amid modest weakness in the U.S. dollar. The price of gold moved higher alongside the euro currency, which rose 0.2% to 1.2664 against the dollar in afternoon trading. The price of gold held firm Monday after another key credit rating downgrade in Europe. Standard & Poor’s – which last Friday lowered its rating on nine euro zone countries – cut its rating on the European Financial Stability Facility (EFSF) to AA from AAA due in part to the deteriorating economic fundamentals associated with the sovereign debt crisis. Commenting on the downgrades, analysts at Societe Generale wrote in a note to clients that “The trigger for the downgrade was the failure of euro-area policy makers to deliver a sufficient solution to date.” Additionally, the firm contended that the markets had been expecting the downgrades, which therefore would not affect the firm’s euro zone GDP estimate of...

The gold price declined Friday morning, sinking $11.00 to $1,638.50 per ounce. Gold prices retreated on the back of a stronger U.S. dollar and weakness in the broader stock and commodity markets. The U.S. dollar climbed against the euro and commodity currencies such as the Canadian and Australian dollars. While the gold price has faced many headwinds in recent months in the form of better than expected U.S. economic data, such was not the case on Thursday. Retail sales increased at the slowest pace in seven months, by 0.1%, compared to the 0.3% consensus estimate among economists. In addition, weekly jobless claims rose to 399,000, well above the 375,000 projected level. The two disappointing data points suggested that the U.S. economy may not be rebounding as quickly as previously anticipated. Moreover, the reports are likely to provide the Federal Reserve with further evidence to maintain its highly dovish stance on monetary policy. Across the Atlantic, the gold pr...

The gold price climbed $13.87 to $1,656.19 per ounce Thursday morning after the European Central Bank and Bank of England each kept their benchmark interest rates at record lows. The 0.8% gain in the spot price of gold was also fueled by weakness in the U.S. dollar, which fell 0.5% against a composite of the world’s leading currencies. The euro rose 0.7% to near 1.28 against the dollar as well after better than expected sovereign debt auctions in Spain and Italy. In terms of specific economic factors, the Beige Book pointed out that consumer spending “picked up in most Districts, reflecting significant gains in holiday retail sales compared with last year’s season.” Demand for nonfinancial services – including professional and transportation services – strengthened further as well. “Manufacturing activity generally continued to expand,” while “reports from financial institutions generally indicated a slight uptick in loan demand by businesses, along with improvements i...

The gold price continued to rebound Wednesday morning as the yellow metal climbed $7.00 to $1,639 per ounce. Gold prices advanced despite strength in the U.S. dollar, which gained against both the pound and the euro. Technical analysts are focused on whether the price of gold will hold above its 20-day moving average, currently at $1,636 per ounce. The gold price closed out 2011 in the midst of a 20% correction, but has now rallied $117 off its December 29th low of $1,522 per ounce. Looking out over a longer time frame, Dundee Securities chief economist Dr. Martin Murenbeeld wrote in his most recent weekly Gold Monitor that the fundamental underpinnings for higher gold prices remains intact. “Our key bullish factor has not changed for years: monetary reflation. In response to record government debt levels, slow growth/recession, and a drift in much of the OECD towards deflation as the household sector continues to deleverage and governments are forced to cut entitlement...

The gold price surged higher Tuesday, climbing 1.8% to $1,639 per ounce. The price of gold broke out above its 200-day moving average and has now advanced $76, or 4.8%, thus far in 2012. Stocks and commodities rose alongside gold as investors speculated that Chinese policy makers were set to pursue more aggressive monetary easing. Since reaching its $1,923 all-time high on September 6, 2010, the price of gold has now fallen 14.7%. However, the strong move to the upside in gold in the New Year has prompted many analysts to ponder whether the multi-month correction in gold prices is over. Long-time gold bull Bill Fleckenstein discussed the yellow metal’s recent travails in his latest weekly MSN Money column. “I’m sure precious-metals bulls were extraordinarily frustrated late in 2011, as gold and silver were sold regardless of the news,” he wrote. “In any event, as the year ended, the stage was set for a potent rally in the metals, and that was what I think we saw star...

The gold price, at $1,620 per ounce, opened to the upside Monday morning. Gold prices traded higher amid weakness in the U.S. dollar, which came on the back of news out of Europe that policy makers may complete a new budgetary legal framework by the end of the month. The euro climbed to 1.275 against the U.S. dollar. S&P 500 stock futures rose modestly, gaining 1.80 to 1276. Commodities traded higher with agricultural products leading the way. One key reason that the gold price maintained its gains despite the positive reports is that upon closer review, the employment data was not nearly as encouraging as first suggested. While the non-farm payrolls data substantially beat expectations, 42,000 of the jobs added were due to a “seasonal quirk in the courier category,” that is likely to be reversed in next month’s report, according to Morgan Stanley economist David Greenlaw. Furthermore, in just the past year, the civilian population rose by 1.7 million, while the l...

While gold is pushing towards its 200d MA at $1,633, we are not convinced that it can sustain a break above this level yet because liquidity remains locked up as the European interbank market continues to malfunction. The stress in the interbank market remains evident in the Euribor/OIS spread which remains high, at 0.95%. During periods of no interbank stress, this spread is usually less than 0.10%. Funding issues continue to result in money being deposited with the ECB instead of being utilised within the greater financial system and, as a result financial assets, including gold, are struggling. We believe gold will move higher as funding stress declines — but not as soon as in January. The lack of liquidity and leverage is reflected in the futures market, where for example gold open interest in COMEX is still very low. In the physical market, we continue to see steady buying of gold. But this demand is more likely to provide support for gold on dips below $1,600 rather than push it ...

The gold price traded near unchanged Friday at $1,623 per ounce despite the stronger than expected December jobs report released this morning from the Labor Department. Gold prices traded in a tight range following the news that nonfarm payrolls rose by 200,000 and the unemployment rate fell to 8.5% – the lowest level since February of 2009. Gold resiliency was also bolstered by positive commentary from two investment banks. Citigroup analyst Tom Fitzpatrick wrote in a report to clients that the gold price sell-off in recent months “has run its course and a rally is now back on the cards.” As long as the price of gold remains above $1,535 per ounce on a weekly basis, Fitzpatrick contended that gold’s long-term uptrend remains intact and it will proceed to reach a new all-time high of $2,400 per ounce later this year. Jeffrey Wright, a senior research analyst at Global Hunter Securities, offered a more conservative but still constructive gold price outlook for 2012. Wr...

Gold rebounded Thursday from earlier losses as the broader financial markets returned to positive territory in afternoon trading. COMEX gold futures fell below $1,600 per ounce this morning but later climbed toward $1,625, while silver bounced back from $28.69 to trade higher by 1.0% at $29.37 per ounce. The rebound in Gold was not accompanied by weakness in the U.S. dollar, however, as the greenback maintained the large majority of its gains against a composite of foreign currencies. The euro remained particularly weak against the dollar, as it fell 1.2% to 1.2791. While Macquarie discussed several near-term headwinds for the sector, it reiterated its longer-term bullish outlook for the gold price and the shares of gold producers. The firm’s favorable stance was based in large part on the expectation that negative real interest rates will remain in place for the foreseeable future. Additionally, Macquarie noted that the firm’s precious metals strategist, Stephen Harris, i...

The gold price oscillated around the $1,600 per ounce level Wednesday, digesting yesterday’s 2.5% gain. News this morning that bank deposits at the European Central Bank’s overnight facility reached an all-time high this week sparked worries that funds are being hoarded – not lent out. Banks parked €453 billion ($591 billion) in the ECB’s overnight deposit facility. Stock prices in Europe fell 0.5% as measured by the Stoxx Europe 600 Index and crude oil slipped 0.6% to $102.39 per barrel. The gold price and broader markets maintained their gains following the release of the latest Fed minutes late yesterday. The summary of the December Federal Open Market Committee (FOMC) meeting revealed that despite the recent improvement in economic data, the U.S. central bank remains quite concerned about the U.S. economy heading into 2012. The Ben Bernanke-led Fed cited the challenging labor and housing markets, along with the euro crisis, as key factors behind its cautious outlo...

Following gold’s 11th straight year of gains, long-time gold bull Richard Russell predicted further gains for the yellow metal in 2012. Russell discussed his latest thoughts on the yellow metal in the most recent edition of Dow Theory Letters , the world’s longest-running daily investment letter. “To my knowledge this is the longest bull market of any kind in history in which each year’s close was above the previous year,” he wrote. “This fabulous bull market will not end with a whisper and a fizzle. I continue to believe that the upside gold crescendo of this bull market lies ahead. We are watching market history.” Russell – who turned bullish on gold near the start of its bull market in 2001 – went on to say that “I note the frustration and anger of the anti-gold crowd. To miss 12 years of rising prices is enough to make any investor furious with himself. I would guess that 99 percent of Americans have never participated in the gold bull market. Thus, sour grapes is the s...