View Full Version : Retail Gold Buyers Stuck with Shortages

9th December 2008, 21:43

Retail Gold Buyers Stuck with Shortages, High Mark-Ups as Global Credit & Lending Collapse; Central Banks Prepare "Money Flood" - Tuesday 9th December 2008
The Gold Price slipped below a tight $10 range early Tuesday, drifting through $768 an ounce as world stock markets rose for the third session running.

"As the wind-down to the holiday season nears and investors draw a line under 2008, Gold is trending towards a range bound closure," says the latest Gold Futures analysis from Mitsui, the precious metals dealer in London.

"Following the substantial moves this year, this conclusion is welcomed."

Crude oil ticked back below $44 per barrel and government bond yields remained in sight of all-time record lows as the US Dollar bounced on the forex markets.

The Gold Price in Sterling traded above 520 per ounce on news of a sharp rise in the UK trade deficit.

French investors saw gold touch 600 after France reported a record trade gap of 7.1 billion for Oct. up by almost one-fifth from Sept. plus a sharply higher government deficit.

New data showed Japanese output shrinking 0.5% between June and Oct., putting the world's No.2 economy in line for its longest post-war contraction to date.

Taro Aso, the prime minister, is said to be planning a 20 trillion ($216bn) stimulus, worth more than 3.5% of Japan's annual economy. Sony Corp. will meantime slash more than 16,000 jobs, Bloomberg reports, in a bid to reduce costs by $1.1 billion.

Today in Beijing a central banker warned that Chinese exports actually fell last month from a year earlier, dragging industrial growth down to 5% from 8.2% in Oct.

"With a dramatic fall in oil prices, gold also lost a lot of ground," reports Wolfgang Wrzesniok-Rossbach in his latest Precious Metals Weekly for Heraeus, the German refinery group.

"Even then, currently trading at $770 an ounce, the yellow metal is showing far greater resilience than for example any of the [industrial] platinum group metals.

"We do not expect much to change in the coming days."

Today the Bank for International Settlement (BIS) founded at the depth of the 1930s' global depression said that global bank lending ground to a halt during the first six months of this year.