Today’s AM fix was USD 1,178.75, EUR 945.46 and GBP 750.56 per ounce. Friday’s AM fix was USD 1,184.50, EUR 950.80 and GBP 753.98 per ounce.
On Friday, gold declined over 2% and silver lost nearly 7%. The scale of the losses, particularly for silver, surprised participants as there was no breaking news story and markets had largely priced in a no victory in the Swiss gold referendum.
Gold in USD - 5 Years (Thomson Reuters)
The Swiss public rejected the proposal to boost central bank gold reserves yesterday and the precious metals weakness continued at the open in Asia when gold fell 2.1% and silver slumped 6.7%, reaching the lowest in five years at $14.42/oz.
The precious metals then rebounded in the course of the Asian trading day, as there was an increase in physical demand and some traders closed out bearish bets leading to a “short squeeze.”
Spot gold rebounded to a high of $1,182.70 an ounce, and was up 1% at $1,179.00 an ounce in late morning trading in Europe. Silver was up 2.7% at $15.83 an ounce, having earlier rallied as much as 6% to a high of $16.34.
Spot platinum was up 0.6% at $1,203.70 an ounce, while spot palladium was down 0.4% at $801.90 an ounce.
Moody's cut Japan's sovereign rating, plummeting the Japanese yen to a seven-year low against the euro, also created a demand for gold, traders told Reuters.
Premiums in China remained steady near $1-$2 and demand in China remains very robust with withdrawals on the Shanghai Gold Exchange (SGE) at 52 tonnes last week. This means that total Chinese demand for gold is headed for 2,000 tonnes in 2014.
SPDR Gold Shares, the world’s largest gold-backed exchange-traded fund, saw holding fall another 1.2 tonnes on Friday to 717.6 tonnes, to 6-year low as weak hands continue to liquidate ETF holdings.
On Friday, India the second largest importer and buyer of gold bullion, removed its import tax and other restrictions on gold imports which is a bullish development
The Perth Mint's silver sales in November climbed to their highest since January as lower prices attracted retail investors, while gold sales fell to a three-month low. The Perth Mint runs the only gold refinery in Australia, the world's second biggest gold producer after China. Silver coin sales jumped to 851,836 ounces in November from 655,881 ounces in October, data on the mint's website showed
Sales of gold American Eagle coins from the U.S. Mint reached 60,000 oz in November down 11% month on month but up 25% on November 2013. Silver Eagles sales in November reached 3.426 million oz, down 41% month-on-month but up nearly 50% year-on-year.