GOLD TEND TO MOVE SIDE-WAYS

by Mr. Prithviraj Kothari, MD, RSBL

As we just thought gold was acting positive and making a comeback, it proves us wrong by the end of Friday.

Gold erased this year’s gains earlier this month on the outlook for higher borrowing costs as the U.S. economy improves. Bullion has since rebounded as the Fed signalled a worldwide economic slowdown may delay interest-rate increases and as equities to commodities slid.

The week was decent enough for gold in the domestic markets, but then internationally showed a sideways performance.

Internationally, gold prices declined after the U.S data reports were in. The better than expected consumer sentiment data lowered gold's safe haven appeal while on the other hand the ongoing concerns over global economic growth and a recovery in global stock markets gave the yellow-metal some support.

Equities and bond yields dropped sharply and the uncertainty over the Fed's hike in interest rates have changed the sentiment for gold from bearish to neutral. Gold showed mixed trends in the week over various economic figures coming in from US

• U.S retail sales and inflation numbers slumped
• Core Retail Sales dipped 0.2%, its first decline since April 2013.
• This indicated to a decline in consumer spending which one of the key indicators of economic growth
• PPI fell by 0.1%, after a reading of 0.0% a month earlier
• US Unemployment Claims dropped to 264 thousand, marking a 14 -year low. 
• Manufacturing numbers were a mix, as Industrial Production gained 1.0%, its best showing since November. 
• The Philly Fed Manufacturing Index dipped to 20.7 points, but this beat the estimate of 19.9 points.

So it was quite a volatile market for gold and there were several factors responsible for this volatility.

DISAPPOINTING GLOBAL GROWTH AND MIXED US DATA REPORTS-

The global equity drop was induced by the European equities sell-off, which was prompted by the negative August industrial production data from Germany and the market's disappointment with the lack of further monetary announcements by the ECB to fight deflation and a likely recession in Europe. The September U.S. retail sales of -0.3%, an inflation expectation of 1.5% in 2019, and foreign growth slowdown have fuelled growth recovery concerns in the U.S. The September manufacturing output climbed 0.5% compared to -0.5% in August, which can signal that the U.S. recovery is holding up.

GOLD DEMAND

The global equity tumult and the ongoing geopolitical concerns have raised the appetite for gold even though the inflationary pressure has created a negative attitude for gold.

The U.S. SPDR gold trust holdings have risen 0.20% this week after declining for four consecutive weeks. 

Moreover demand for gold from India has risen ahead of the biggest festive season of Diwali and many have made their purchases at dips. India's September gold imports jumped sharply to $3.75 billion ahead of the wedding and festival season, data from the trade ministry showed.

Meanwhile in China, the world's largest consumer for gold, has witnessed a significant drop in demand for gold even though price are running low but demand here is also expected to pick up. Growth in Gold mine output from China is set to slow significantly in coming years in the face of declining ore grades and waning profitability, an analyst at Business Monitor International said on Friday.

Now we need to see what's in basket for gold in the coming week. Gold could trade sideways next week and multiple factors are expected to influence the price of the precious metal.

FED- markets will keep an eye in the Fed Chair's speech this Friday

US- Traders will be tracking news coming in from the equity markets, alongside news about a likely global slowdown, the future pace of US stimulus, US interest rates, the Ebola scare in the US , the U.S leading indicators index , the U.S September new home sales, the U.S September CPI, September US leading indicators index and geopolitical tensions the world over.

CHINA-Next week, we will monitor the September China industrial production data, the Q3 China real GDP growth.

The primary purpose of this article by Mr. Prithviraj Kothari is to educate the masses of the current happenings in the Bullion world.

- Previous blog -

"Is Gold Making A  Comeback?"

http://riddisiddhibullionsltd.blogspot.in/2014/10/is-gold-making-comeback.html

GOLD'S FUTURE AT STAKE!!

by Mr. Prithviraj Kothari, MD, RSBL

As 2014 began, it was all green for gold. Investors thought that gold has once again entered the bull market. But this week gold shunned all its gains in 2014 and fell 0.7 per cent.

On the other hand the dollar reached a four year high this week as there were high expectations in the market that more jobs were added in three months. This further added to the speculation the Fed may raise interest rates next year.

When the dollar gets strong and the U.S. yields are higher than gold is counted as one of the least attractive investments. The feeling that investors had about gold in 2008, they are feeling the same for dollar now as all investors are bullish about the dollars prospects. 

Now gold has been abandoned by many as this metal is not paying interest and  Gold was also depressed by a rebound in European shares, which had slumped on Thursday on disappointment the European Central Bank wasn't more aggressive at its meeting. Dollar has strengthened more than a per cent against a basket of other currencies and is on a straight track of gains for the 12th week. 

The non-farm report. US non-farm payrolls rose by 248,000 jobs, and the jobless rate fell to 5.9 percent last month, the lowest since July 2008,as stated by the Labour Department. The change in total non-farm payroll employment for July was revised from 212,000 to 243,000, and the change for August was revised from 142,000 to 180,000. With these revisions, employment gains in July and August combined were 69,000 more than previously reported.

Post this report spot gold fell as much as 1.4 percent to its lowest since Dec. 31 at $1,195.38 an ounce and was down 1.3 percent at $1,197. It was for the first time in 2014 that gold fell below $1200 on Friday as the dollar strengthen over the positive US non-farm payroll data. Gold fell even further when the markets agreed that the interest rate hike could happen by mid-2015 or even earlier.

Rising interest rates reduce gold’s allure because the metal generally only offers investors returns through price gains, while a stronger dollar typically cuts demand for a store of value.

Moreover, SPDR Gold Trust, the top gold-backed exchange-traded fund and a good proxy for investor sentiment, said its holdings fell 1.19 tonnes to 767.47 tonnes on Thursday - a new low since December 2008. This declined gold prices further. 

Apart from the data reports released during the week, it was weak physical demand that could not provide support to gold prices.

Demand from China was low as the Chinese markets remain closed for a week long holiday. Though gold prices did get some support from the Pro-democracy rallies in Hong Kong but it was not enough to reverse all the losses from a stronger dollar.

Now the markets await for the Chinese and Indian markets come back next week, they may see lower prices as a good buying opportunity, so possibly some support will come from physical demand in Asia and in the U.S. the Fed policymakers will scrutinize the data as they prepare for a policy meeting on Oct. 28-29

METAL	INTERNATIONAL	DOMESTIC
GOLD	$1180- $1207 an ounce	Rs. 26,000- Rs. 27,500 per 10gm
SIILVER	$16.40- $17.50 an ounce	Rs. 37,000- Rs. 40,000 per kg

The primary purpose of this article by Mr. Prithviraj Kothari is to educate the masses of the current happenings in the Bullion world.

- Previous blog -
"Dollar Drawing Directions For Gold" - http://riddisiddhibullionsltd.blogspot.in/2014/09/dollar-drawing-directions-for-gold.html

DOLLAR DRAWING DIRECTIONS FOR GOLD

by Mr. Prithviraj Kothari, MD, RSBL

                                                     

During the financial crisis in September 2008, gold price rose $50 in a single trading day on 18th September. Investors adapted gold as they perceived this asset to be a safe haven in terms of liquidity and security.  This day was marked in history as it was after February 1980 that gold had made such a huge jump in one single day. in 1979 and 1980, the world witnessed global uncertainty. At that time the key influencers for gold were the Russian invasion of Afghanistan and the Iranian hostage crisis. Most of these factors were geopolitical. 

Even today gold has been hovering around the geo political uncertainties. In fact during 1980 it as just geo political tension but today its lots more. Terrorism along with financial uncertainties have had a great impact on gold prices.

The key driver of the gold price at the moment is perceived to be the relative strength of the US dollar, yet the US dollar is only stronger compared to the other main currencies because these currencies, such as the Euro, are weak due to their economies remaining weak and their money supplies having been debased.

Gold is falling on concerns over strengthening US economy and the stronger dollar. Dollar gained ahead of the data to be released next week which includes the monthly employment numbers that the Fed will be watching. Currently it appears that while the rest of the world is in the doldrums, The US economy is performing comparatively well. The Dollar index hit a high of 85.68 and closed at 85.64 for the week on strong economic data from the US.

U.S. economy has grown in fastest pace in 2 and a half years in the second quarter. The Commerce department raised its estimate of growth in gross domestic product to a 4.6% annual rate from the 4.2% pace reported last month.

During the week, gold traded near the lowest level in almost nine months as the dollar rose to a four-year high amid prospects of higher borrowing costs as the U.S economy improves. 

Though September is considered as one the best performing months for gold, this year the yellow metal has declined 5.3 percent in this month itself. After dropping to $1207.04 on September 25, it has touched the lowest level since 2nd January. 

Gold prices continued their downhill ride to touch a low of $1,207/ounce last week. However, they bounced from that point and closed the week at $1,218/ounce, up from $1,215.7/ounce in the previous week. The fear of gold  miners cutting down on production if prices plunge below $1,200 is holding prices. The cost of production of major gold miners is about $1,350/ounce now, according to estimates of analysts.

Despite the news of US-led strikes against militants in Syria, gold prices didn't move up much as expected as metal continues to loose its safe haven appeal to investors. The US SPDR Gold Trust, the largest gold-backed exchange-traded fund, saw its holdings are at 772.25 tonnes on Friday - the lowest since December 2008.

Gold is also heading towards its first quarterly loss this year as strong data coming from US has made the metal weak. Data last week showed the world’s largest economy grew the most since 2011 in the second quarter. Consumer spending accounts for about 70 percent of gross domestic product. In the US, data showed that sale of new homes surged in August and hit its highest level in more than six years. Also, the final estimate of the second quarter (April-June) GDP that was released on Friday showed that the US economy expanded by 4.6 per cent.

Hence I still feel that The dollar remains the driver of gold direction.

Though geopolitical worries may not give that push or support to gold prices, there are chances that gold may witnessed recovery and not fall significantly from current levels. 

with the mining costs of most gold producers at $1,330-1,350/ounce, they can shut mines and stop new explorations. In such a case, supply will fall and curtail prices from slipping lower.

Moreover, if the dollar continues to rally, there may soon come a point when it will turn a concern for exporters in the country.

Demand has always been a supportive factor for Gold prices and it shall continue to do so in the near future:

World's largest bullion consumer- China- has been importing more gold in September than in the previous month due to demand from retailers who are stocking up gold for the upcoming National Day Holiday. From 1st October, Chinese markets will closed for a week and during this period retail sales are expected to rise. Data on Thursday showed that China's net gold imports from Hong Kong rose in August from a three year low in July. Moreover, imports are expected to remain high due to seasonal demand

Apart from this , one interesting trend that we witnessed was the rising demand for gold from India. After nearly 5 months, we saw some positive news coming from the bullion markets in India as buyers appear to be taking advantage of the relatively low gold prices. Gold demand has picked up across the country, according to traders, despite it being the `shradh' period, which many in India consider inauspicious for buying not just gold, but even other commodities such as cars, there has been some buying reported across retail outlets. As we all know that active market players usually buy at dips. But this time apart from the market player we also saw retail demand for gold rising. 

Russia added to its Gold holdings for a fifth month in a row in August, while Kazakhstan raised its holdings by nearly 800,000 ounces, data from the International Monetary Fund showed on Thursday.

Summing it up, I would like to say that the Middle East is a powder keg that seems likely to explode. The U.S. and western nations have taken a hard stance against an increasingly powerful Russia. This is effecting an already fragile Euro zone and other economies.

Gold has protected wealth throughout history from financial crises and war. We believe it will continue to do so in the coming years.

TRADE RANGE:

METAL	INTERNATIONAL price	DOMESTIC price
GOLD	$1206- $1237 an ounce	Rs.26,000-Rs.27,500 per 10 gm
SILVER	$17.15- $18.00 an ounce	Rs. 38,500 - Rs. 40,000 per kg

The primary purpose of this article by Mr. Prithviraj Kothari is to educate the masses of the current happenings in the Bullion world.

- Previous blog -

"Investors losing interest in gold over interest rate rise"

http://riddisiddhibullionsltd.blogspot.in/2014/09/investors-losing-interest-in-gold-over.html

INVESTORS LOSING INTEREST IN GOLD OVER INTEREST RATE RISE

by Mr. Prithviraj Kothari, MD, RSBL

Last week we saw that the dollar denominated all the markets especially gold. It was the strengthening dollar that was responsible for the plunge in gold prices. 

This week it was even more worse. Precious metals tumbled down and the losses coincided with the recovery of USD against leading currencies such as Euro and Yen and the rally of U.S equities. 

The main market movers were the US Dollar and the Chinese economy. 

Though other markets have also seen volatility, the impact on the precious metals markets has been severe. Equities have been on a bull run but commodities have consistently been on the downside and have been hit with sliding prices and withdrawals by investors, squeezing profit opportunities for funds and traders. 

Gold closed at $1205 in 2013 and picked up well in 2014, rising to a high of $1380 in March. But post March, gold prices plummeted and have witnessed a loss of 5.5 per cent so far in September.

Gold prices declined for the third straight week after the Fed raised it approximate for a key lending rate even as policy makers confirmed an assurance to keep borrowing costs close to zero percent for a substantial time.

The chief reason for the recent weakness is the US Federal Reserve's projection for where official interest rates will be heading. The reason why the market has been so reactive to the interest rate rise is that an increase in interest rates and bond yields would raise the opportunity cost of holding gold. Currently gold has is not strong and has been giving negative returns. The strong co relations between gold and US bond yields will further reduce gold prices. Moreover, higher rates also tempts investors to shift to riskier assets like stocks that have been considerable returns. Moreover it continued to set records in 2014.

On Thursday, gold settled at its lowest closing price since the end of December, pressured by the dollar’s move higher after the Federal Reserve meeting on Wednesday

Spot gold was down 0.5 percent on Friday and among other precious metals, silver was down 2.5 percent to $18.01 an ounce. It touched $17.81, its lowest since August 2010.

On Friday the price of gold fell again, reaching a fresh 2014 low following three weeks of straight selling on the back of a strong dollar and expectations of a rise in US interest rates

Globally, we have witnessed financial uncertainty from 2009-2012. This had compelled investors to adopt gold as gold has always been considered a safe haven asset in turmoil.

The Fed now expects that short-term interest rates will be back to normal levels of around 3.75% by the end of 2017.

With the US Federal Reserve announcing a further $10 billion reduction in its monthly purchases, leaving the programme on course to be shuttered next month, it has also made clear that record low interest rates would be around for at least a few more months.

China followed by India are the worlds largest consumers of gold. But this year, demand for gold from both countries faded. Demand in China, which overtook India to become the top consumer of the metal last year, fell by 22 per cent to 351 tonnes in the first half of the year as the country's economic growth slows down, after reaching record levels in 2013. Jewellery fabrication in India, the world's second largest gold consumer, declined by 18 per cent to 296 tonnes in the first half on lower official imports after the hike in imports duty last year.

We still await some rise in demand from both countries because July, August and September are typically months for strong months of Gold performance months as buying from Asia increases – particularly due to upcoming festivals and wedding season in India.

A good gauge of demand is buyers' willingness to pay a premium over the international price.

Gold imports travelling through Shanghai's Pudong International Airport surged by 200 percent month on month since June as the Shanghai Gold Exchange (SGE) announces plans to allow foreign investment into China's gold market.

Some modest signs of increased demand in the physical gold market after a dramatic slump in Asia this year, have emerged.

To conclude, I think that precious metals are more likely to suffer tougher times if the dollar stays strong and if positive data continues to flow in from US. Well if it happens otherwise then gold may witness a bullish run.

WEEKLY TRADE RANGE-

METAL	INTERNATIONAL price	DOMESTIC price
GOLD	$1206 - $1256 AN OUNCE	RS. 26,200 - RS. 27,500 PER 10 GM
SILVER	$1750 - $1825 AN OUNCE	RS.39,000 - RS. 41,000 PER KG

The primary purpose of this article by Mr. Prithviraj Kothari is to educate the masses of the current happenings in the Bullion world.

- Previous blog - "Denominating Dollar"

http://www.riddisiddhibullionsltd.blogspot.in/2014/09/denominating-dollar.html

A BOOSTER MONTH FOR GOLD?

by Mr. Prithviraj Kothari, MD, RSBL

Gold has established a support level at $1275 since March and prices have risen post this level. 

But, during the second half of March gold fell heavily from resistance around $1400 back down to a several week low near support at $1275.

As 2014 began, gold moved very well for the initial months towards a six month high near $1400 and has now plunged to levels closer to $1300.

As news of the escalating tensions in Middle East and Ukraine gained momentum, gold gained 5.4 per cent year due to rise in demand for this safe haven asset.

After hovering at around $1290 gold has plunged sharply over the last week and has broken through the support at $1275. 

It rallied a day ago however ran into further resistance at $1275 before falling lower to a four month low around $1258.  

Though gold has always been the markets favourite metal during uncertainties, but this time bullion investors continue to worry over strong U.S. economic data and its impact on the dollar.

This week we saw gold falling to its lowest level in three months, on Friday before it recovered modestly.

On Tuesday, Gold witnessed its greatest drop this week as the market broke through recent support at the $1,270 area.

Gold was  unable to capitalize on the news of the ECB’s interest rate cut and QE program as the euro weakness offset any support gold would have received from the new liquidity programs.

AS tensions lingered over Ukraine and a weak dollar forced bargain hunting, we saw gold prices rising on Wednesday after prices earlier fell to a two and a half month low.

The yellow metal was under pressure after the Russian President drew plans for a ceasefire but then regained its prices when the Ukraine prime minister later dismissed Russia's proposal.

The metal is under pressure as the euro languished near a 14-month low versus the dollar on Friday, struggling to regain its footing after the European Central Bank delivered a fresh round of stimulus and promised even more if needed.

Gold was standing firm above the $1270 level in Thursday as it was impacted by a weaker Euro and surging equities after the European Central Bank cut interest rates to record lows which was counteracted by lower than expected U.S. jobs data. 

The main refinancing rate was cut to 0.05 per cent from 0,,15 per cent and the ECB lowered the rate on bank overnight deposits to -0.20 percent. 

But what surprised the market was Fridays U.S. jobs data that gave gold a push thus helping it to return to modest levels overnight. 

The U.S. Labor Department said the economy created 142,000 jobs in August, far below expectations for a figure of over 200,000. The unemployment rate fell to 6.1%, a six-year low. The average pace of job creation this year is 215,000, up from 194,000 in 2014. 

Gold rose from an 11-week low, after U.S. employers added the fewest jobs this year, adding some pressure on the Federal Reserve to maintain lower interest rates.

Initially data reports had stated the US economy was back on the path of recovery but Fridays number were a bit disappointing .

A stronger greenback is a setback for dollar denominated gold as it makes the yellow metal more expensive for users of other currencies.

 Gold traders are likely to keep an eye on currency moves next week after the euro fell to a 14-month low versus the dollar Thursday, following the surprising move by the European Central Bank to cut interest rates and embark on a quantitative easing program.

Traders will also extend a warm welcome to the month of September as it has historically been the best performing month for gold giving an average return of 2.16 per cent since 1969.

A spike in retail demand in India is another reason for the typical bump.

We hope this month the be a booster for gold.

The primary purpose of this article by Mr. Prithviraj Kothari is to educate the masses of the current happenings in the Bullion world.

- Previous blog -

"Bull v/s Bear"

http://riddisiddhibullionsltd.blogspot.in/2014/08/bull-vs-bear.html

THE SENTIMENTS ARE BEARISH FOR GOLD

by Mr. Prithviraj Kothari, MD, RSBL

On the first day of last week, gold was down. But it changed direction by Wednesday and bounced back.

This week too there was a lot in store for gold- 

• the GDP for leading economies including Japan, Germany, and Great Britain 
• the U.S PPI, retail sales, industrial production JOLTS, jobless claims and consumer sentiment reports . 
• Germany’s economic sentiment and GB’s inflation report.
• Gold for the month of July was up by over 2 per cent mainly due to the escalating global tensions and the lower than expected US data

As the week began, gold was slightly down, retreating from a three-week high as tensions between Ukraine and Russia eased and investors turned to rising European shares and some withdrew from exchange-traded gold funds. The United States had criticized Russia's military exercises in Southern Russia as provocative step in The Ukraine Crisis. But last week, late on Friday, Russia's Defence Ministry said that it has ended these exercises. This was the main reason for pushing gold prices down. The premium that was built on gold since mid June is more vulnerable to fade as easing Geo-political tensions push gold prices down.

There is a lot of uncertainty in the market surrounding the FED's decision to raise interest rates, that now many market players aren't quite sure whether they should go back to gold particularly when other assets like equities look more attractive.

But how soon will that happen? Nobody knows... Till then Bullion investors will continue to monitor U.S. data releases as the strength of the world's largest economy dictates the pace at which the Federal Reserve tightens monetary policy.

After a few lows, gold stabilized on Tuesday as signs emerged that the stand-off between Russia and Ukraine was hurting confidence in the euro zone economy and on fears a Russian aid convoy heading to Ukraine could further stoke tensions. Concerns over the Ukraine crisis and its financial impact hit economic sentiments in Germany.

Gold is always seen as an alternative investment medium over equities and other assets.

On Wednesday, Gold was above $1300 on Wednesday as downbeat data from China keep investors cautious about gold. This along with the Ukraine crisis and a slowly recovering US economy kept gold prices firm.

Bullion was also helped by data on Thursday that showed the number of Americans filing new claims for unemployment benefits rose more than expected last week. That helped push US yields lower.  Spot gold rose 0.2 percent to $1,315.20 an ounce by 1003 GMT, 

A weak dollar and sluggish US and European data provoked investors to switch to safer investments.

Gold prices were slightly lower on Friday, paring losses on safe-haven buying as equity markets slid after Ukraine said its forces had engaged a Russian armored column on Ukrainian soil in what appeared to be a major military escalation. It was like a roller coaster ride from a near high of $1310 to $1292 and then back to $1310 and a close above $1300.

Apart from the Data reports and the crisis, it was the sluggish physical demand for gold that played a influential role. Physical demand in top consuming region Asia has been sluggish after a record year in 2013, while investors have been cutting positions in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund. The fund reported a 5.36 tonne drop in its holdings last week, its largest outflow since early May.

For the time being the market seems to be bearish for gold (apart from the perceived geopolitical tensions) and I feel investors should sell on the upside.

TRADE RANGE-

METAL	INTERNATIONAL  (Gold/Silver price)	DOMESTIC (Gold/Silver price)
GOLD	$1281- $1320 an ounce	Rs. 27,800- Rs. 29,000 per 10 gram
SILVER	$19.15- $20.20 an ounce	Rs. 42,500- Rs.44,500 per kg

The primary purpose of this article by Mr. Prithviraj Kothari is to educate the masses of the current happenings in the Bullion world.
- Previous blog -
"Appetite for gold rises"
http://www.riddisiddhibullionsltd.blogspot.in/2014/08/appetite-for-gold-rises.html

ESCALATING TENSIONS.....ESCALATING PRICES!!!!

by Mr. Prithviraj Kothari, MD, RSBL

In the past week gold and silver dropped drastically. Even the ongoing tensions in Russia and Israel could not provide support to gold. US laying sanctions along with European counter parts on Russia hasn't proven that effective till now whereas the cease fire process between Israel and Hamas group has gone for a toss.

It is very difficult to list "a" particular reason for fall in gold prices. Rise and decline are both influenced by a variety of factors. 

CHINA: 

China has been one of the key drivers of gold in recent years, but now there is word that China may be increasingly less important to the gold story.

While the U.S. economy recovers, China’s demand for gold plummeted in the first six months of 2014. This helped to allow gold to fall back under the $1,300 per ounce mark on Thursday, after having been up more than 8% so far in 2014. Demand in China for gold was down by a whopping 62% for gold bars, and gold coin demand was also down by a sharp 44%.

China announced gold consumption figures for the first half of 2014. The China Gold Association announced that they fell to 569.45 tons as demand for gold bars declined 62 % to 105.58 tons, the world’s largest consumer said. Gold coins and other uses of gold dropped 44 % to 10.95 tons, while use in jewellery rose 11 % to 426.17 tons and industrial use climbed 11 % to 26.75 tons.

Last year was a record and China and the nation’s consumers are focusing on other internal and external issues rather than gold. Still, this drop in demand is much more than many industry observers might have assumed.

US ECONOMY:
After China it was key US economic indicators that continued to pressurize gold.

The number of Americans filing new claims for unemployment benefits fell to the lowest level in nearly 8-1/2 years last week, suggesting the labour market recovery was gaining traction. The belief that the US economy is on the path of recovery pulled gold prices down. 

Geo-political tensions: 
Escalating geopolitical tensions have induced support to Gold prices. 

The U.S. stated late Thursday that Russian troops or pro-Russia rebels are shooting artillery shells at Ukraine targets from within Russia’s border. Russian President Vladimir is facing more pressure to expedite the investigation into the crash of a Malaysian passenger on July 17 in Ukraine.

Meantime, the Israel-Hamas fighting continued to be intense. Gaza authorities said Israeli forces shelled a shelter at a U.N.-run school on Thursday, killing at least 15 people. Fighting this month in Gaza has killed more than 800 Palestinians and 35 Israelis. 

Ukraine and Russia traded accusations of cross-border shelling as tensions between the ex-Soviet neighbors intensified. 

The growing tensions and havoc on Eastern Europe and the Middle East this week has boosted demand for safe haven assets liked Gold. 

Spot gold was up 0.7 percent at 1,301.81 an ounce, after losing nearly 1 percent on Thursday, when it hit its lowest since June 19 at $1,287.46. Gold rose on Friday, re-bouncing from the previous session's drop to a one-month low, as heightened tensions between Russia and the West over Ukraine and situation of Gaza not getting better prompted speculators to buy back their bearish bets ahead of the weekend.

RUSSIA AND TURKEY:  
Gold holdings in Russia's and Turkeys bullion reserves increased in June as both countries lifted their reserves.

Russia, the world's fifth-largest bullion holder after the United States, Germany, Italy and France, increased its gold holdings by 16.8 tonnes to 1,094.8 tonnes in June, the IMF's International Financial Statistics report showed.

Turkey, the world's 12th-largest nation in terms of gold ownership, raised its precious metal by 9.9 tonnes to 512.9 tonnes for the month. It counts gold held on deposit with it by commercial banks as part of the central bank's bullion holdings.

THE BANK ESPIRITO SANTO- This crisis has been contagious for the world. When the world of electronic finance catches the flu, the true nature is all systems fail. One of Portugal's largest banks, Espirito Santo, sent waves through the financial system when we learned they would default on a payment. And they have been fighting against bankruptcy ever since.

Next week, will be a week to watch. 

• Comex expiry for Gold contracts on 28th July.
• 2nd Quarter Advance GDP release on Wednesday morning
• Wednesday afternoon we will hear the results of a two day FOMC meeting. 
• The Non-Farm Payrolls Report for July on Friday August 1. 
• The Chicago PMI, Michigan Sentiment, and the ISM Index
• Geo political tensions.

Lots more in the basket and lots of surprises for precious metals. These factors will surely influence gold prices...what we need to see is HOW?

TRADE RANGE:

METAL	INTERNATIONAL	DOMESTIC
GOLD	$1292-$1334 an ounce	Rs.27,700-Rs.28,700 per 10 gram
SILVER	$20.15- $21.50 an ounce	Rs.43,600-Rs.46,000 per kg

The primary purpose of this article by Mr. Prithviraj Kothari is to educate the masses of the current happenings in the Bullion world.
- Previous blog - "Gold and Silver On A  Swing"
http://www.riddisiddhibullionsltd.blogspot.in/2014/07/gold-and-silver-on-swing.html