Gold Update 29 October

My apologies for the lack of an update last week, it has been an exceptionally busy time for us - with the New Zealand Mint's collectable coins flying out the door as well - especially the Sputnik 50th Anniversary coin. Check out the story here.

The past couple of weeks haven't seen much great movement in the gold price, until Friday night. Gold is now trading just over USD$790 per ounce.

This is a big movement, based primarily on a weaker US dollar and stronger oil prices. The situations in Turkey and Iran are also big influences on the price as well.

Some articles on the big move from Friday:

Bloomberg
Reuters
Reuters again
The Independent

and the Resource investor

As you can see, there are a lot more people bullish on gold now than earlier this year.

Given the predicted rates drop in the US shortly we could see our dollar (NZD$) start to climb back up again (which helps to keep the price of gold down here) so the outlook is for more movement both in the gold price and the exchange rate.

Gold interest story of the week:

Gold nanoparticles 'in new rapid meningococcal diagnostic test'

Gold update 15 October

Another busy week in the world of Gold, with the price finally breaking through the US$750 mark.

The big influences this past week - once again, is the $US Dollar ( inflation and sub-prime concerns and crude oil prices.

Coupled with next years expectation of $800/oz from Morgan Stanley the medium term strength in Gold as an investment is definitely looking good.

Given the well publicised issues with South African mining safety currently - The South African mining union (NUM)has announced their intention of holding a national strike to bring attention to the 200 mining deaths last year. South Africa is currently the largest Gold mining country in the world accounting for 11% or 275 tonnes of total 2467 tonnes mined in 2006 (source)

Another interesting announcement regarding central bank gold sales -
Germany has no intention of selling their gold

Gold can make you invisible! - well OK, only in 2 dimensions, and maybe not completely invisible, but hey, its a start :)

Gold price info 5 October

A busy week at the Mint, with lots more interest being shown in bullion.

We've ended the week with the big news of the Miners being trapped at the Elandsrand mine in South Africa. The good news is that everyone was evacuated safely.
The amazing news is there were more than 3000 miners trapped, larger than an average New Zealand town, hundreds of metres below ground.
This will have an impact upon the gold price (albeit possibly very minor) as it will affect supply for the next couple of months at least.


Oil has also been moving around , but it appears there may be a further reduction in the oil price next week with the announcement that some Los Angeles based refineries will come back on line after a power outage. From Reuters:
HOUSTON, Oct 4 (Reuters) - ConocoPhillips and Valero Energy Corp said on Thursday their Los Angeles-area refineries were expected to resume normal operations during the weekend after being shut Wednesday morning by a power outage.
Both Valero's 135,000 barrel per day (bpd) refinery and Conoco's 139,000 bpd refinery on Thursday were carefully working through processes to restart from cold shutdowns, company officials said.
Valero's refinery and Conoco's refinery are in Los Angeles industrial suburbs, portions of which were hit by the power outage, according to the Los Angeles Department of Water and Power.

Once again finance companies are hitting the news locally with another company going into recievership and the announcement that 5 Star may only pay as little as 25% back to its investors.

The upcoming wedding season in India was forecast to reach 1000 tonnes but this has been revised to break the record of 800 tonnes this year.

Central bank sales have been confirmed at 475 tonnes this year which is closer to the first years slaes under the Washington agreement.

As you are no doubt aware, one of the driving factors behind the bulish tone for Gold and Silver at the moment is the US dollar. How this impacts other economies is quite fascinating.
Some examples :Central Banks Inflation Quandary As Gold Prices in More US Interest Rate Cuts
and a more Euro centric take on the issue.

I have to admit to being a bit of an Apple Mac fan boy. But even I think this is a little too much: Introducing the Gold Macbook Pro

Gold update 01/10/2007

Gold increased in price again over the weekend, currently sitting at USD$745 per ounce. This is up just over 1.5% and is a 28 year high. The prime factor behind this upward movement is currently the weakening US Dollar, which after staging a short recovery against major currencies like the Euro, continued to drop to record lows at the end of the weak.

The other factors - oil prices ,the financial risk flight, the middle east, all continue to back up the current scenario of strong movements upwards in the price.

Overseas analysts are currently estimating between $750 and $850 per ounce by the end of 2008, but depending upon who you read or listen to that can move any where up to $1200 per ounce.

Locally the big impact is once again our climbing dollar, with the carry trades appearing to be resuming, and stronger than anticipated economic reports (GDP up 2.2% for the year) which could lead to higher interest rates towards the latter part of the year. This means that the price of gold in NZ Dollars, is once again getting cheaper (albeit slightly at the moment) even though the gold price internationally is sky rocketing.

Press Release - Swiss National Bank Gold Sales
Between 15 June and 26 September 2007, the Swiss National Bank sold a total of 113
tonnes of gold. The gold sales fall within the bounds set by the second gold agreement of 8 March 2004, in which the central banks of the Eurosystem, plus the Sveriges Riksbank and the Swiss National Bank, agreed to limit their gold sales over a period of five years,beginning on 27 September 2004. The third year of this agreement ended on 26 September.
On 14 June 2007, the SNB announced that it would be adjusting the composition of its
currency reserves and would, to this end, sell a total of 250 tonnes of gold by the end of September 2009.

This gives a great indication of the market is accommodating large volumes of gold sales, and what can be expected from the central banks going forward.

G24-carat iPod hits golden notes