Gold turned lower after non-farm payrolls came in at 243,000

The gold price fell $8.35, or 0.5%, to $1,751.47 per ounce Friday morning as the January U.S. jobs report came in well above expectations.  The price of gold turned lower after non-farm payrolls came in at 243,000 – handily beating the 140,000 consensus estimate among economists.  The unemployment rate dropped to 8.3%, below the expected 8.5% level and the best reading since February 2009.The gold price was also pressured by the U.S. dollar, which rebound from earlier losses against a basket of foreign currencies.  European markets extended their gains following the report, while S&P 500 futures climbed 0.9% to fresh six-month highs of 1,334.75.

 Dennis Gartman, publisher of the widely-read Gartman Letter and a long-time commodities investor, reiterated his bullish call on the gold price and equities yesterday.  “Gold is rising in terms of all currencies these days,” he noted.  “Gold is a protest against monetary expansion, and hence we might well consider owning equities AND gold, for both have been, are, and will be the beneficiaries of these expansionist policies.”
Anne-Laure Tremblay, an analyst at BNP Paribas, also presented a bullish case for the price of gold in a recent note to clients.  “Gold’s fundamentals are strong and the recent rebound in risk appetite has encouraged investors to come back to the market or add to their existing positions,” said stated.  “We expect gold to reach new highs in 2012, although episodes of extreme risk aversion may trigger corrections along the way.”

Comments

Post a Comment

Popular posts from this blog

Gold edges up on weaker dollar, dovish U.S. Fed policy bets

Image
 Gold edged higher on Monday, helped by a weaker dollar and expectations that the U.S. Federal Reserve will reiterate its dovish monetary policy stance this week. Spot gold was up by 0.1% at $1,943.58 per ounce. U.S. gold futures rose 0.1% to $1,950.10 per ounce. “Gold is firm on the basis that the Fed could adopt a further dovish message with respect to average inflation targeting,” said Michael Hewson, chief market analyst at CMC Markets UK. “If you want to have a policy of average inflation targeting, you’re going to have to go into detail as to how you are going to arrive at that particular outcome.” The dollar retreated on Mond ay, bolstering gold’s appeal for investors holding other currencies, ahead of the Fed’s policy decision due on Wednesday. “If inflation forecasts remain at 2% or below, this could offer gold a tailwind as the zero-yielding metal thrives in a low-interest rate environment,” said FXTM analyst Lukman Otunuga. Market participants are also waiting
Read more

For the gold price, two outcomes are possible.

Image
For the gold price, two outcomes are possible. First is a return to or near the April low ($1,277.40). Second is a drop to a lower low, $1,240 - $1,260. Yet a third possible outcome is that the June and December lows were not a double bottom and one further drop may come. I account that the least likely, and look for a low here by the end of the week, but I'm no more'n a nacheral born durnd fool from Tennessee, so what do I know?   You'd think that an institution charged with promoting the gold industry would produce reports that at least cast the best light on gold's prospects. You'd think wrong, if you're thinking about the World Gold Council. They've been negative on gold for, oh, the last 14 years or so. Today they issued a report that contained a nugget about Chinese business using physical gold as collateral for bank credit ($40 bn worth) but they managed to tease a gloomy forecast even out of this inventive monetary use. That and bad
Read more

India, not Trump, is the real reason behind the crash in gold prices

Image
If you have been puzzled about the crash in gold prices after Donald Trump's election, you are in the company of almost every analyst and media outlet in the western world. Gold and silver are a major part of the research at The Arora Report. A combination of our proven precious metal algorithms, extensive resources and knowledge of the emerging markets led us to alert subscribers to The Arora Report early that gold was about to crash and the reason behind it. Immediately after the election, the net position of The Arora Report in gold, silver and miners has been short as part of a sophisticated strategy.
Read more