LONDON (Commodity Online): Precious price action was mixed on Thursday amid thin liquidity given the US holiday. Gold and Silver prices edged modestly higher while the PGMs lost further ground with Platinum closing 0.4% lower at $1536/oz, a one-month low.
According to Barclays, gold prices closed $2 higher at $1694.3/oz as the dollar retained its strength against the euro and market focus centred on Europe where government bond markets remained under pressure. While gold investment demand has firmed up in recent weeks, physical demand from Asia has been weaker than expected amid the seasonally strong period for consumption, with healthy interest only responding to price dips.
The PGM markets have remained under pressure as macro concerns weigh on the demand outlook exacerbated by investment demand weakness. In turn the supply picture has been sidelined as the South African rand has weakened.
In supply news, Zimbabwe has said it will double its Platinum mining royalties to 10% in its 2012 budget while Gold royalties will rise to 7% from 4.5% adding to the political uncertainty and clouding the significant platinum mine supply growth potential in Zimbabwe.
Meanwhile, South Africa’s National Union of Mineworkers has said it has reached a two-year wage agreement with Northam Platinum (2010 platinum production: 221koz, Palladium 69koz).
