Last Updated : 29 September 2012 at 12:05 IST
Gold in Euro terms breaks all time high, more to come: Commerzbank
Source :Commodity Online
Gold to maintain its lure as a store of value. Given the current market environment, the price is likely to continue on its upward trajectory.
By Col. Ajay
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LONDON (Commodity Online): Following several attempts in recent days and weeks, gold hit all time record high of 1,380 euros an ounce on Thursday and spot metal has been above $1,780 an ounce several times this week, said Commerzbznk, the second largest German bank after Deutsche Bank.
The Commerzbank expected to gold to maintain its lure as a store of value. Given the current market environment, the price is likely to continue on its upward trajectory.
“The debt crisis in the eurozone has escalated again, for example, as evidenced among other things by what are in some cases violent public protests against the new austerity packages in Spain and Greece. What is more, rating agency Moody’s is about to make a decision on Spain’s credit rating--the country is at risk of being downgraded to junk status,” the second largest German bank added.
In addition, the loosening of monetary policy by central banks is contributing to growing inflation concerns and fears about a ‘currency war’ between major currencies.
Gold should therefore remain in high demand as a store of value and alternative currency. Silver has risen in gold’s slipstream and has drawn further support from strong inflows into exchange-traded funds. September alone has seen inflows so far of 410 tons or 2.2%, Commerzbank concluded.
Global gold prices were down on Friday and the week. The most-active December gold contract on the Comex division of the Nymex settled at $1,773.90 an ounce, down 0.23% on the week. December silver settled at $34.577 an ounce, down 0.176% on the week. On the month, gold rose 5.1% and silver gained 9.97%.
Global gold posted its biggest quarterly gain in more than two years as market stimulus and easy monetary policies by central banks around the world boosted bullion's inflation-hedge appeal.
The metal is within reach of its 2012 high, while open interest for US gold futures surged to a one-year high on heavy buying related to fund positioning before the quarter end.
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