السبت، 21 يوليو 2012

Safe-Haven Bid to Buy Gold "Still Missing" as Latest Euro-Crisis Talks Begin, Falling Commodities "Pull Silver Lower" - 28 June 2012

Prices to Buy Gold slipped 0.5% in London wholesale trade Thursday morning, dropping back below $1570 per ounce as stock markets accelerated their losses ahead of today's Eurozone crisis summit in Brussels – the 12th such meeting in the last 12 months.

"Nein! No! Non!" said the front-page of German finance daily Handelsblatt, urging chancellor Angela Merkel not to concede to calls for weaker monetary or fiscal policy across the 17-nation currency zone.

Syria's state TV meantime reported what it called "terrorist" bomb attacks on the main court in Damascus, while neighboring Turkey deployed anti-aircraft rockets along the border.

"There's no semblance of a safe-haven [in gold] at the moment," says Société Générale's Robin Bhar, quoted by Reuters.

"But as the price goes lower that bid [to Buy Gold ] does come back as you maybe get some renewed investor interest," he adds, citing sovereign wealth funds and central banks.

Silver Prices also slipped again early Thursday, "feeling the effects of lower base metals and crude oil prices," according to one dealer, and retreating towards last week's new 2012 lows beneath $26.70 per ounce.

Brent crude – Europe's benchmark oil price – today slipped to $92.25 per barrel, only just above the marginal cost of production according to analysts at Sanford C. Bernstein & Co.

The recent drop "marks the start of the next oil price up-cycle," they believe.

Back in Silver Bullion, "I suspect some fairly chunky stops will be lurking just under these levels," says refiner and financier MKS's senior trader in Sydney, Alex Thorndike.

"If we get closer, especially considering how thin this market is currently, we could see larger players gunning for these" to drive Silver Prices still lower, he believes.

Major government bonds meantime pushed higher Thursday morning, nudging 10-year German interest rates down to 1.51% per year as the Euro currency slumped one cent to a 3-week low of $1.2410.

Italy had to pay 6.19% per year today at a sale of new 10-year bonds, up from 6.03% a month ago.

Today in Greece – where bank deposits have apparently turned positive since the election of pro-bailout Samaras party last week, and where police in Thessaloniki said they'd broken up a Euro-coin counterfeiting ring, the country's first such discovery – the new Parliament was sworn in.

New prime minister Antonis Samaras' government yesterday dismissed the senior management of the Greek national bank, risking a revival of "the practice of making political appointments" according to one banker.

Cyprus was granted formal approval for a joint European Union, IMF and European Central Bank bail-out worth €10 billion – well over half the country's annual economic output.

Slovenia "will see a Greek scenario" said its prime minister, Janez Jansa, in a radion interview unless debt-growth is stemmed by further spending cuts and tax hikes.

German unemployment today showed a rise of 7,000 for June, only its third rise of the last 3 years but suggesting that "the resilience of the German labour market is slowly cracking up," according to analysts at ING bank.

Eurozone consumer confidence worsened in June, falling to its worse level since mid-2009 on the European Commission's latest survey. Industrial sentiment worsened to 2.5-year lows.

A raft of UK economic data for the first quarter was revised lower, with GDP now seen contracting by 0.3% from the end of 2011.

"The elevated cost of wholesale funding for banks has continued to be passed through" to mortgage and business borrowers, the Bank of England said today in its latest Credit Conditions report.

Looking ahead, UK lenders see credit getting tighter for corporate borrowers than for households, especially in commercial real estate.

"Markets await news on the EU summit," says Thursday's note from Standard Bank in London, but "not much progress is expected on the key issues...[such as] a move towards a common bond markets, as Germany remains vehemently in opposition.

"Consequently, we feel that the Euro will stay on the backfoot, lending a downward bias to precious metal prices."

Investment bank Morgan Stanley today cut its precious metal forecasts for 2012-2014, mapping the cut onto its outlook for global commodity prices, but remaining long-term bullish.

Morgan Stanley's analysts now see the price to Buy Gold averaging $1677 per ounce this year, down from the previous forecast of $1825.

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