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Physical Buying Supports Gold

July 18, 2013 at 23:26 by Vladimir Vyun

Gold rallied today as low prices spurred buying of bullion. It looks like physical demand makes for what the metal lacks from the investment side.

Additionally, Federal Reserve Chairman Ben Bernanke spoke today alleviating fear of stimulus reduction. He also expressed his view on the recent losses of gold:

One reason gold prices are lower is people are less concerned about extreme outcomes, particularly negative outcomes, and therefore they feel less need for whatever protection gold affords. A lot of people hold gold as an inflation hedge, but the movements of gold don’t predict inflation very well, actually.

Futures for delivery of gold in December rallied $6.7 (0.52 percent) to $1,285.5 per troy ounce as of 22:41 GMT on COMEX today. Bullion has lost 23 percent this year so far.

If you have any questions and comments on the commodities today, use the form below to reply.

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