Gold And Silver Consolidating!

January 24, 2017

Gold Today –New York closed at $1,215.30 on the 23rd January after closing at $1,201.50 on the 20th January. London opened at $1,213.35 today.

Overall the dollar is weaker against global currencies today. Before London’s opening:

 -         The $: € was weaker at $1.0752: €1 from $1.0730: €1 yesterday.

-         The Dollar index was weaker at 100.20 from 100.42 yesterday. 

-         The Yen was stronger at 113.24:$1 from yesterday’s 113.61 against the dollar. 

-         The Yuan was stronger at 6.8534: $1, from 6.8541: $1, yesterday.

-         The Pound Sterling was stronger at $1.2482: £1 from yesterday’s $1.2452: £1.

Yuan Gold Fix

Please note that the Shanghai Fixes are for 1 gm of gold. From the Middle Eat eastward metric measurements are used against 0.9999 quality gold. [Please note that the 0.5% difference in price can be accounted for by the higher quality of Shanghai’s gold on which their gold price is based over London’s ‘good delivery’ standard of 0.995.]

Shanghai was trading today just above 270 Yuan or in dollars, at today’s exchange rate, $1,226,15 having touched nearly 272 during the day. The dollar is only slightly weaker across the board, as well as against the Yuan.

New York, Monday, closed in line with gold prices in Shanghai earlier in the day, before New York opened. This is a first, as New York climbed up to Shanghai’s levels despite an over 2 tonne sell-off from the SPDR gold ETF.

London opened on Tuesday $8.00 lower than Shanghai was trading at today. Shanghai is, once again driving prices despite the stronger Yuan against the dollar. It demonstrates that gold is rising against all currencies today and in all gold markets.

Chinese New Year

This weekend sees the start of the Chinese New Year, so the current demand is particularly for that holiday, which will last a week. During that time the Shanghai Gold Exchange is likely to be quiet. Will this see a fall-off in prices? It is likely that we will.

With India struggling to find the cash to buy gold still, India will not shore up the gap made next week. So it is likely we will see falling prices until the Chinese return.

LBMA price setting:  The LBMA gold price was set today at $1,213.30 down slightly from yesterday’s $1,213.75. 

The gold price in the euro was set lower at €1,129.39 after yesterday’s €1,134.35 as the dollar stabilized.

Ahead of the opening of New York the gold price was trading at $1,213.65 and in the euro at €1,129.61.  At the same time, the silver price was trading at $17.14. 

Silver Today –Silver closed at $17.18 at New York’s close yesterday from $17.07 on the 20th January. 

Gold (very short-term) The gold price will consolidate with a stronger bias, in New York today.                                                                                               

Silver (very short-term) The silver price will consolidate with a stronger bias, in New York today.

Price Drivers

Despite over 2 tonnes of sales of gold from the SPDR gold ETF yesterday, the gold price in New York rose. Of course, that sale would only be reported at the end of the day and if it was sold into the market, it would be sold into London, which did not move higher this morning in London. Nevertheless, the amount is not so large that it is a price mover, but after stuttering small purchases into the U.S. based gold ETF’s in the last fortnight this was the first sale seen since early January. It followed a purchase the business day before of 1.85 tonnes, so its impact would have to be muted.

President Trump is sticking to his election promises on the foreign policy front by cancelling the TPP trade deal. As we said yesterday, ‘He looks as though he will ensure a protectionist, introverted set of policies that will move away from the avuncular, globally dominant policies,” that we have been used to from the Second World War. This is not too dissimilar to the policies China has followed for the last two decades and we see the spectacular results in China. The emerging world will suffer, particularly those that relied on U.S. trade for their economic health. They will look for other avenues of capital and trade inflows.

We can see that happening right now as President Trump’s withdrawal of the U.S. from the TPP agreement presents an opportunity to China to move into its place, in that Agreement. With China having created such a power, so far, it is able to bring the other members under its influence. But China will only walk that road if China benefits independently of the U.S. - Sounds Trumpish, doesn’t it? [see our www.GoldForecaster.com issues].

Gold ETFs – Friday, in New York, there were sales of 2.074 tonnes of gold into the SPDR gold ETF but there were no purchases or sales into or from the Gold Trust, leaving their respective holdings at 807.071 tonnes and 198.75 tonnes. 

Since January 4th 2016, 204.941 tonnes of gold has been added to the SPDR gold ETF and to the Gold Trust. 

 Julian D.W. Phillips 

GoldForecaster.com | SilverForecaster.com | StockBridge Management Alliance  To ensure you can benefit from the future higher gold prices we will see then, you need to hold it in a manner that makes sure it can’t be taken from you. Contact us at admin@stockbridgemgmt.com to buy physical gold in a way that we feel, removes the threat of it being confiscated. We’re the only storage company that offers that!

Julian Phillips is the Founding Partner of Gold Forecaster - Global Watch and Silver Forecaster [incorporating Platinum]. Mr. Phillips analyzes the gold, silver, and platinum market alongside the macro economic currency aspects of these precious metals. He covers the shares involved in these sectors and publishes numerous articles on specialist websites concerning precious metals. Mr. Phillips is also a specialist in Exchange Controls and international currencies. He has qualified to be a member of the London Stock Exchange. His working life has focused on Gold/Currencies/Fund Management and now Silver and Platinum. Additionally, Mr. Phillips has spent some years in capital creation in currency distressed countries through exchange control incentives. Mr Phillips is also the Chairman of Stockbridge Management Alliance Ltd. a company that offers gold storage in a way designed to prevent its confiscation should such an order be issued in any country. His websites are at http://www.goldforecaster.com  and http://www.silverforecaster.com/.

Minting of gold in the U.S. stopped in 1933, during the Great Depression.