India gold imports to fall 53% in 2012: Bombay Bullion Association

Indian gold imports is set to crash by over 50% in 2012 owing to high prices and increasing taxes imposed by the government, as per the Bombay Bullion Association (BBA). India is the world's biggest gold market and such a big fall in imports could effectively dethrone the country from being the leading gold importer in the world.

In a Reuters Survey, Prithviraj Kothari, President of the BBA estimated that 2012 gold imports could fall down to 450 tonnes, down 53% compared to 969 tonnes imported in 2011. “Last year we had good imports but looking at the pace of the fall so far we are heading for a big fall in 2012"

Meanwhile Q1, 2012 gold imports are seen down 56% at 125 tonnes due to Jeweller's strike and a slow season. "It is March, which is a lean period for jewellery business. Moreover the loss in sales incurred during the 10 days of ongoing strike by jewellers will hit imports. It is likely to be less than 125 tonnes in the January-March period,", The Press Trust of India (PTI) quotes Kothari. Q1, 2011 imports were at 283 tonnes.

The Indian government had raised the import duty on gold while also doubling the customs duty. This was seen as a move to control the influx of huge quantities of gold that has been putting a strain on India's fiscal deficit. Coupled with the current higher prices of gold, many analysts are predicting Indian demand to fall drastically.

And with the crashing Indian demand, China could overtake India to become the biggest gold market in 2012.

High Oil prices strain Gold mining companies, keeps stocks undervalued against Gold

High oil prices are squeezing the profits of oil companies who are already battling the headaches of high labour cost and higher taxes. And with gold prices stabilizing at the same time, some producers may just fell the heat until the yellow metal resumes its bull trend.

The high volatility in oil prices have forced gold companies to hedge their oil needs. Even the world's biggest gold producer- Barrick Gold- had to hedge oil prices considering the uncertainty in the markets. “As the oil spike relates to our cost structure, we've got things under control. But as far as what an oil price rise means to the broader economy, obviously we have some concerns there”, Reuters quotes Barrick CEO Aaron Regent.

Some analysts argue that high oil prices can dent the profits of gold miners even if gold climbs. And as the producer is forced to mine for lower grades, the company yields lower gold for every processed rock with energy costs remaining the same- and this situation of lower yields and higher input cost will inevitably lead to lower profits for the gold mining companies.

The market seems to have picked up on the reasoning as well as gold stocks have constantly underperformed gold prices for most of the gold's bull market- a period when input costs like energy, labour and other prices have been rising as well.

Chart showing performance of Gold (GLD etf) and Gold mining companies (GDX etf)

Gold edges up as Greece hopes lift sentiment

* Gold ETF holdings rise to record high
* Spot gold could rebound to $1,712/oz - technicals
* Coming up: U.S. jobless claims, weekly; 1330 GMT

 SINGAPORE, March 8 (Reuters) - Gold edged higher on Thursday, extending gains into a second session, as fears about a messy default for Greece eased after signs it may be able to secure a crucial debt swap deal. 
    Gold has been recuperating from a selloff earlier in the week, together with the euro and equities, after promising U.S. jobs data and hopes that Greece will complete a crucial bond swap deal.   
    Spot gold edged up 0.2 percent to $1,688.70 an ounce by 0720 GMT, standing above the 200-day moving average of around $1,678. Gold gained 0.6 percent on Wednesday following a 2-percent slide in the previous session. 
    U.S. gold gained 0.3 percent to $1,689.50.      Expectations that central banks will continue to promote growth by maintaining easy monetary policy also helped buoy gold, even though the sterilised bond buying under consideration by the U.S. Federal Reserve, as reported by the Wall Street Journal, in itself might diminish gold's appeal as an inflation
hedge.  
    "Central banks are expected to take up the role of the main agent of stimulus, since distressed governments can't provide any help on the fiscal front," said a Singapore-based trader. 
    "I still see a lot of long positioning out there."      Holdings in the gold-backed exchange-traded funds  hit a record high, and gained 269,000 ounces since last Wednesday, when gold prices collapsed 6 percent after U.S. Federal Reserve chief Ben Bernanke disappointed investors by not referring to any further monetary easing.      "That's a good sign, as investors appear to think it is a good opportunity to get their hands on gold," said Dominic Schnider, head of commodity research at UBS Wealth Management in Singapore.      Physical demand also started to pick up after prices dipped below $1,700, he added.      Spot gold could rebound towards $1,712 an ounce during the day, said Reuters market analyst Wang Tao.  
     
     
    Gold is traditionally viewed as a safe haven asset that benefits during political and economic turmoil, but in the past few months gold has largely moved in tandem with riskier assets as the financial distress threatens liquidity in the market.   "When equities drop, the pool of available funds for investing in commodities will shrink and gold will be in a bad
position to compete for investors cash because its sticker price is much higher," said the trader.      "Gold is a very risky asset. People who look at it as a safe haven are missing out one thing -- when gold becomes volatile, it becomes much more volatile than currency or bond markets."       On Friday, investors will await the key U.S. non-farm payrolls data for cues on whether the Fed is likely to launch any stimulus measures soon. China's January inflation data and industrial output data due Friday will also be closely watched, as investors gauge the pace of the world's second-largest economy. the world's two largest platinum producers said on Wednesday they were not affected by a 1-day nationwide strike in South
Africa that has brought the country's gold mines to a halt and also hit the coal sector.   Spot platinum gained 0.9 percent to $1,639.99, off a 2-1/2-week low below $1,700 hit earlier this week. 
     
   Precious metals prices 0720 GMT
  Metal             Last    Change  Pct chg  YTD pct chg    Volume
  Spot Gold        1688.70    3.94   +0.23      7.99
  Spot Silver        33.65    0.27   +0.81     21.52
  Spot Platinum    1639.99   14.50   +0.89     17.73
  Spot Palladium    682.80    2.00   +0.29      4.64
  COMEX GOLD APR2  1689.50    5.60   +0.33      7.83        13587
  COMEX SILVER MAY2  33.70    0.12   +0.34     20.72         2164
  Euro/Dollar       1.3172
  Dollar/Yen         81.29
  COMEX gold and silver contracts show the most active months
  

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Platinum could well be next gold for investors

By Daryl B ChapmanAre you worried about your future? Do you want to stay on top of your finances? With so many people losing their jobs because of economic downturn, people are becoming more realistic on how they are managing their finances. They are looking for secured alternatives to keep their money.

Financial experts believe that because of the unpredictability of the economy, people should learn how to budget their money wisely. The expenses should not be more than the actual earnings or else they will end up loaning in banks and debts may increase if people are not so careful. One way to protect wealth is to invest in a good investment vehicle. One of the best investment vehicles is venturing in rare collectibles like platinum.

Platinum is a popular choice among coin collectors and investors alike. It is very rare and its supply is limited. For this reasons, many are opting to obtain this metal as part of their portfolio. Platinum as investments can come in various forms from coins, bars, bullion to futures. Aside from the reasons mentioned above, why should people venture in platinum?

Currently, platinum is one of the most expensive metals in the global market. It is even more costly than Gold and silver. If you have the budget, then invest in platinum. However, if your budget is limited, you can start with coins because they are more convenient to have. The price of platinum is sometimes even double the price of gold. However, when the economy is down, the price can go down as well.

If you are going to conduct a study about platinum, you will find out that platinum can also be found on the moon and the meteorites in outer space. Only a small portion is found in the phase of the earth. Eighty percent of which are found in South Africa, eleven percent in Russia and the remaining six percent in North America.

As compared to the annual production of Gold which is 82 million troy announces,Platinum only has a yearly production of five million troy ounces. Given that information, the supply of platinum is considerably diminishing and with the high demand of platinum in the global market, the price of this rare commodity is estimated to rise significantly.

Based on statistics, China, India and other Asian countries are the biggest consumers of jewelries today. There are even reports that China's demand for platinum jewelry has doubled in just one year. These countries are very interested in acquiring platinum for their jewelry production because characteristically, platinum has Silver blue color making it ideal and very in demand in the jewelry industry.

As mentioned previously, platinum as investments come in different forms. If you are a first time investors, you may start with coins and bullion. Coins and bullion are easy to transport and if you are saving on storage you can just keep it at home, locked in a secured cabinet or safe. 

Once you feel the need to upgrade you can simply advance to more complex and sophisticated investment options in platinum like Platinum stocks, mutual funds, ETFs and futures. These investments can provide promising returns, however they are not recommended for beginners because these can investments are complicated and very risky.

If you are looking for an investment vehicle to venture on, why not invest in platinum? But before you do, analyze your budget and know everything about platinum by continuous research. Good luck!
Courtesy : EzineArticles.com

 

Run to gold, Iran-Israel war is coming: Marc Faber

NEW YORK (Commodity news world): Marc Faber aka Dr Doom has given out a new warning to investors- a war between Israel and Iran is coming. Faber, a perennial bear, is the publisher of the famous Gloom, Boom and Doom report"Political risk was high six months ago and is higher now. I think sooner or later, the US or Israel will strike Iran - it's almost inevitable”, Faber said in an interview with Reuters while also adding that in the event of a war, “Bernanke will just print even more money -- they have no option...they haven't got the money to finance a war. You have to be in precious metals and equities... most wars and most social unrest haven't destroyed corporations - they usually survive”In an earlier interview with Bloomberg, Faber had stated that QE3 would depend on the S&P. “If the S&P drops 100-200 points, then yes, for sure we will have QE3”

A latest Barclays report had suggested that investors continue to accumulate gold on dips while also watching out for the $1800/oz level, as a breakout from this level could indicate bullish bias.

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Gold caps biggest weekly drop since December

Gold capped the biggest weekly loss since mid-December as a stronger dollar lowered the appeal of precious metals as alternative investments. Silver also fell.
The US dollar jumped as much as 0.8 per cent against a basket of currencies after German retail sales unexpectedly declined in January. Gold has declined 3.7 per cent this week, the largest drop since Dec. 16, while the dollar has advanced 1.3 per cent.
"The dollar is pushing gold down," Pratik Sharma, a fund manager at Atyant Capital Management said.
Gold futures for April delivery fell 0.7 per cent to settle at $US1709.80 an ounce on the Comex in New York. Prices fell 1.7 per cent last month after the Federal Reserve gave no signal of additional economic stimulus, spurring the biggest one-day drop in 11 weeks on Feb. 29.
"It will probably take a few more days for physical demand to really come in with full force" as recent price drops are likely to spur purchases, Edel Tully, an analyst at UBS in London, wrote today in a report.
The precious metal has gained 9.1 per cent this year as holdings in exchange-traded funds backed by bullion reached a record yesterday.
Silver futures for May delivery on the Comex fell 3.2 per cent to $US34.525 an ounce, capping a weekly loss of 2.5 per cent.
On the New York Mercantile Exchange, platinum futures for April delivery declined 0.6 per cent to $US1691.70 an ounce. The metal dropped 1.4 per cent this week. Palladium futures for June delivery decreased 0.6 per cent to $US712.55 an ounce.
Bloomberg

Read more: http://www.smh.com.au/business/markets/gold-caps-biggest-weekly-drop-since-december-20120303-1u9b7.html#ixzz1o1FFKFoo

Emerging market demand may pick up after sell-off in gold: HSBC

LONDON (Commodity news world ): Emerging-market demand for gold may pick up after Wednesday’s sharp sell-off, said HSBC in a daily research note.

According to HSBC, gold and silver fell as the dollar rose when Federal Reserve Chairman Ben Bernanke, appearing before Congress, stopped short of signaling readiness to conduct another round of bond purchases.

“The inability of gold to clear USD1,800/oz in recent days, the sharp increase in net long speculative positions on the Comex since the new year, and the paucity of emerging-market buying in recent weeks left gold vulnerable to a selloff, which dragged silver lower in its wake,” HSBC added.

“Declines of this magnitude, however, often attract emerging-market buyers and may also interest potential central-bank buyers. Buying from these quarters could soon staunch the decline.,” HSBC said.

“Furthermore, monetary policy remains accommodative not only in the U.S. but in other nations, the USD is still dogged by structural weaknesses, according to HSBC currency research, and global oil supplies remain vulnerable to geopolitically led disruptions. These factors should help reignite the gold rally, we believe,” bank concluded.