Gold Price info - week ending 27 July

Gold spot price ranges
USD: 660.00 - 685.50
NZD: 853.45 - 869.25
NZDUSD: .7779 - .8135
It’s been a busy week for gold, first starting with a strong increase in price to US$686/oz on Monday and Wednesday, only to have this reversed down to a low of $660 on Thursday night trading, recovering to $666 during the day.
The price of gold should also been seen in light of New Zealand Dollar exchange rate movements. We started the week just below 0.80c, reached a high of 0.8135 before the turnaround after Dr Bollard announced the .25% hike in interest rates. Currently the Dollar is trading around the .785 mark (after going below .78 early today.)
What is the cumulative effect of these movements on the price of gold in NZ dollars? Not a lot. We’ve sent the spot price move within a $20 margin between $850 and $870.

Looking forward the general feeling amongst gold bullion brokers is still quite positive, with the end of the Indian Monsoon season approaching; the expected demand for gold is likely to increase.
The current outlook isn’t for huge spikes in price but a more controlled growth in gold price. With strikes possible again in South Africa, supply and demand are still strong influences in the future price of Gold.

Gold doors to a bank in Oman
There is a bank in Oman which has gold doors. The gilding of doors goes back to ancient times when fire gilding and later mercury gilding techniques were used on alloys containing gold to produce a gold-rich surface layer. The famous Corinthian Bronze of the Roman Empire is an example of this used in the great gate of Herod's Temple in Jerusalem.

Gold Price info - week ending July 20

Gold spot price ranges
USD: 662.60 - 677.50
NZD: 837.27 - 854.98
NZDUSD: .7862 - .7957

A very strong week for gold, the price has increased by 4% since the previous week. Again the main factors influencing the price - oil and the weaker US dollar.

Again the sub-prime lending market in the USA is causing issues, with Fed Gov Bernanke mentioning that the current sub prime losses are in the $50 - 100 billion range. The first major casualty being the Bear Stearns hedge fund essentually going bust. They alone controlled nearly 10 billion in mortgage related securities and credit derivatives.

Oil continues to rise, again because of a shortage of gasoline supplies in the US during the Summer driving season. Coupled with OPEC refusing to raise output, and Iran reducing the amount they export in August, this may continue to be an issue.

In New Zealand the exchange rate is still the talk of the town. With Dr Bollard possibly raising interest rates again, the expectation is for another increase in the exchange rate. However Dr Cullen may intervene, but that is yet to be seen... An indication of how the exchange rate is making the price lower in New Zealand - Since January the Gold price in US$ has risen by 7%. in NZ$ it has increased by only 2%. This is highlighted by the chart above I will extrapolate on it further next week.

Microphone Check : A sad story where John Laws of radio 2UE has had his Gold microphone stolen.

Gold price info - week ending July 13

Gold spot price ranges
USD: 653 – 669.00
NZD: 838.00 – 861.00
NZDUSD: .7842- .7878

Chart showing relative prices for Gold Spot in USD and NZD (NZD on left)

Gold has had a stronger week this week; primary factors are the rising oil prices and the weaker US Dollar. Currently it is trading above the upper resistance of US$665 with an expectation of further growth.

Oil prices are reaching record prices because of several factors: issues in oil producing countries like Nigeria (civil unrest and kidnappings), Iraq and Iran (continuing issues in Iraq, terrorism, American strength in the Persian Gulf increasing). US Gasoline shortages have corrected but now Crude is starting to become an issue. Market watchers in the past have explained that strong crude supports gold two ways - due to inflationary implications of higher energy costs, and because large speculators often move into metals at the same time they are going long in crude futures.

The other major influence on the gold price has been the US Dollar weakening. The Big issue here is the Sub prime lending market and the belief that this is going to continue to cause issues in the future. This has led to a significant weakening against the other major currencies – record high for the Euro - 1.3798 - and a 26 year high for the Pound peaking at 2.0134 early in the month. Gold often moves inversely to the dollar, with market participants seeking hard assets when the greenback is weak.

Locally we saw a drop in the NZDUSD cross earlier in the week (.772) but as you can see this has picked back up and is well on the way back to the previous record highs. Driving this is the high interest rates which are appealing for the global Carry trades. The expectation is here is for continued strength in the NZDUSD cross (also aided by the weaker USD), but the big question is for how long?

Interesting news: Remeber the shipwreck in the news recently? More developments in the sunken treasure world - Odyssey shipwreck intercepted by Spain

An interesting spin to the weekend barbie - Sizzle sausages on a gold barbeque

Gold price info - week ending July 6

Gold spot price ranges
USD: 657 – 647.00
NZD: 827.00 – 844.00
NZDUSD: .7870- .7760

A steady week for gold. We are seeing a compressed price range, with the main emphasis being on expectation of growth rather than immediate rises.
A stronger US dollar has seen downward pressure on gold; this can be seen by the drop below $650 and recovery after the July 4th holiday period.

The NZD again is the major player in the local market, with no sign of the Reserve bank intervening despite the 78c mark being reached. We have calculated that if you took the exchange rate back 1year ( .6300 ) you would expect to see a 22% increase on today’s price. A great argument for hedging!

Newmont mines announced this morning that they had scrapped their entire 1.85million oz gold hedge position. This is expected to push prices up, but appears to be still being digested by the markets. Watch this space.
Once again oil is hitting the headlines, this time because of the issues in Nigeria, including a series of kidnappings of oil workers, which coupled with the gasoline stock issues in the US and the continuing problems in the gulf; we are starting to see the oil prices creep upwards, which in turn adds impetus to the upward gold price.

Again the over all consensus is a period of consolidation prior to more upward growth for the bullion market.
Reefton gold mine opening
Don’t throw away your cell phone – $340 million worth of gold in them.