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Market Report: PMs confined to tight trading range

Fri, 04/17/2015 - 05:57
Precious metal prices were broadly unchanged this week, confined to a tight trading range of $1210 to $1185 for gold and $16.60 to $16.00 for silver. There were several attempts by sellers to force prices to break down, but from the price action there appeared to be buyers waiting for the opportunity.

The result was that yesterday gold rallied to as high as $1209 and silver to $16.50, though they closed well under these best levels when a senior Federal Open Market Committee member warned that interest rates would not remain at zero for ever. Comex volumes in gold were light though they were better in silver.

Gold's performance in other currencies has been more impressive, especially in euros and sterling shown in the next chart.

 

Open interest on Comex in both metals rose over the week, with silver's close to a record high on Wednesday. This is consistent with accumulation on dips and should be viewed as generally positive. Silver's Open Interest is shown in the next chart.

 

Physical demand for gold continues to be strong, with the news that India imported 125 tonnes in March, while Shanghai Gold Exchange deliveries totalled a further 195 tonnes. Global mine production on a monthly basis is about 250 tonnes, so the markets must have delivered a net 70 tonnes more than this production to satisfy just two Asian sources of demand.

One wonders how much demand from other Asian buyers is also being covered by deliveries from Western vaults. This tight delivery position is at odds with technical trading in paper markets, with gold confined to its current range. Presumably (and this makes sense) western mines are hedging the price by selling for forward delivery, putting a short-term cap on the market.

One of the more intriguing news developments is a joint World Gold Council/Official Monetary and Financial Institutions Forum (OMFIF) meeting this morning in New York to discuss the inclusion of gold in the SDR basket when it is revised later this year. It was agreed in 2010 that the renminbi should be included, but this has never been ratified by the Americans. It is believed by close observers that China's exclusion from the SDR is one of the reasons China set up the Asia Infrastructure Bank rather than pursue the IMF relationship. However, if the proposal to include a weighting for gold in the SDR1 gets any traction at this morning's meeting, it will be interesting to see the reaction from the Americans, given that the Chinese appear to want to incorporate gold into international settlements. It could also provide the Chinese cover for declaring an increase in the gold content of their official reserves.

For what it's worth, the chairman of OMFIF (Lord Desai) is quoted as saying gold's inclusion in the SDR is quite likely to happen. However, there are legal obstacles to overcome.

 

Next week

Monday

No material releases

Tuesday

Japan: Leading Indicator (Final), Customs Cleared Trade
Eurozone: ZEW Economic Sentiment

Wednesday

UK: BoE MPC Minutes
Eurozone: Flash Consumer Sentiment
US: Existing Home Sales, FHFA House Price Index

Thursday

Eurozone: Flash Composite PMI, Flash Manufacturing PMI, Flash Services PMI
UK: Public Borrowing, Retail Sales
US: Initial Claims, Flash Manufacturing PMI, New Home Sales

Friday

Japan: All Industry Activity Index
US: Durable Goods Index

 

[1] After the collapse of the Bretton Woods system in 1973, the SDR was redefined as a basket of currencies. Today, the SDR basket consists of the euro, Japanese yen, pound sterling, and U.S. dollar. The value of the SDR in terms of the U.S. dollar is determined daily and posted on the IMF's website.

Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

 


The over valued dollar

Thu, 04/16/2015 - 12:05
There are two connected reasons usually cited for the current dollar strength: the US economy is performing better than all the others, leading towards relatively higher US dollar interest rates, and that this is triggering a scramble for dollars by foreign corporations with uncovered USD liabilities. There is growing evidence that the first of these reasons is no longer true, in which case the pressure to buy dollars should lessen considerably.


In coming to this conclusion we must be careful not to limit our thinking to the dollar rate against other currencies. They are arguably in an even worse position, with active Quantitative Easing in both Japan and the Eurozone failing to resuscitate industrial life, while the UK is in the middle of a heated election campaign. Instead we should think primarily in terms of the dollar's purchasing power for goods and services, and here the market is already skewed to one side: the public prefers to hold dollars and reduce debt rather than spend freely, because everyone knows that prices of consumer goods are not rising and, so the logic goes, inflation is dead and buried.


Such unanimity is always dangerous and the mainstream fails to notice that far from an inflationless recovery, the US economy appears to be stalling badly. This is hardly surprising since private sector credit is still tight. Depending whose figures you use, total US debt is estimated to be in the region of $57 trillion, an increase of about $4 trillion since the banking crisis in 2008. However, government and state debt held by the public has risen by $6.7 trillion and large corporations have borrowed a further $2.3 trillion to buy back shares. Meanwhile financial debt, which includes asset backed securitisations of consumer debt, has fallen by about $4 trillion, while consumer debt directly held has declined slightly. These rough figures suggest that credit for households and smaller businesses remains constrained.


Since mid-2014 markets have undergone a sea-change, with the dollar strengthening sharply against the other major currencies and the oil price collapsing along with a number of key industrial commodities. The Baltic Dry Index, a measure of shipping demand, has recently fallen to the lowest level ever recorded. Admittedly there is a glut of ore carriers helping to drive shipping rates down, but there can be no doubt that trade volumes are down as well; and there has also been hard evidence with China's imports and exports having declined sharply.


Common sense says that from the middle of 2014 the world ex-America entered the early stages of an economic slump. Common sense obviously took time to catch up with the U S, and it is only in the last month or so that mainstream economists have begun to cautiously down-grade their GDP1 forecasts. It is now impossible to ignore the confirmations which are coming thick and fast. This week alone has seen inventories stuck on the shelves, small business optimism declining and the National Association of Credit Managers reporting serious financial stress; and that was only Monday and Tuesday. This is the background against which we must assess future dollar-denominated prices.


Conventional wisdom would have us believe that an economic slump leads to an increased demand for cash as businesses are forced to pay down their debt: this is essentially the Irving Fisher debt-deflation theory from the 1930s. It is for this reason that modern central banks exist and they stand ready to create as much money as may be required to prevent this happening. Let us assume they succeed. We then have to consider another factor, and that is the progress of monetary hyperinflation, for this becomes the underlying condition driving dollar prices.


Central banks can nearly always debauch their currencies with impunity. People automatically think that money is stable and do not generally draw the conclusion that a rise in the level of prices is connected to an expansion in the quantity of money or credit. While they often admit that money buys less today than it did thirty or forty years ago, and they are aware of the consumer price index trend, they may fail to appreciate that money can and does change its purchasing power from day to day. The result is they attach changes in prices not to money but to factors affecting individual goods.


There are several factors that affect prices, one of which is an increase in the quantity of money when that new money is spent on the goods being considered. Obviously, if the new money is not spent on consumer goods, but hoarded or spent on something else, an increase in the quantity of money will not lead to higher prices for items in a consumer price index. But more importantly, prices are inherently subjective, which is why we cannot forecast tomorrow's prices. If you find this hard to accept, just look at the average stock trader's record: if he is very good he might have a 10% edge, but even then he cannot tell you tomorrow's stock prices.


Subjectivity of prices is the consequence of changing preferences for money relative to individual goods. In the current economic climate with its restricted credit people are understandably cautious about spending, which means their preference for money is relatively high. But not everyone shares the same preferences, and they are likely to be different across different classes of goods as well, with commodities and raw material prices behaving differently from the prices of finished goods, even though they are linked.


So far price rises due to monetary inflation have been generally restricted to financial markets and associated activities. Early speculators have done very well, with today's buyers being forced to pay considerably higher prices for the same investments. Despite this obvious phenomenon, speculators do not usually understand it is the swing in preference from money towards financial instruments that is behind the rise in prices.


But what if this relative preference starts to swing in favour of commodities? The swing in preference has meant the price of oil in dollars has already risen 25% in recent weeks, or alternatively, we can say the purchasing power of the dollar has fallen by that amount. Copper, the commodity that should be collapsing as we go into a slump, has also risen, this time by 15% over the last two months.


Commodity traders who look at the charts will tell you that these are normal corrections in a bear market for the commodities involved. But how can this be, when we are entering a deflationary slump? The answer is simple: there has been a change of preferences with respect to oil, where buyers value oil more than dollars, and also for copper. This should not be confused with an increased desire to own oil and copper; rather it is a reduced desire to hold dollars relative to these two commodities.


If the idea the dollar is weakening spreads from selected but economically important commodities it could begin to alter the balance of preferences more generally, for which almost everyone is ill-prepared. How long the process takes we cannot know until it happens; but if the general public realises it is the dollar's purchasing power going down instead of goods prices rising, it will be very difficult to stop its purchasing power from collapsing entirely.

 

The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

 

 

1 Gross Domestic Product

Dealing Desk: A week of selling

Thu, 04/16/2015 - 04:52
It has been a week of net selling at GoldMoney with gold dancing around the US$ 1,200 mark all week, a price that is a psychological benchmark in the market.

Customer activity

Most of GoldMoney's selling has come out of its Swiss vaults followed by the UK. Volumes of orders were up this week for both buy and sell, but there was a bias toward selling. Some of this activity may be attributed to speculation that an imminent US interest rate rise could pull down the price of precious metals.

 

 

Market events

On Wednesday, the European Central Bank president, Mario Draghi, – after dodging a protestor while giving a press conference in Frankfurt –announced that the bank was ruling out a deposit rate cut, which indicated faith in the strength of the European economy. The US Dollar lost ground against the Euro as a result.

On the same day, the US industrial output data was released that showed that output was slower than expected, which was met with general disappointment andChina released figures that showed that its economy had grown by only seven per cent in the first quarter of 2015 – the slowest rate of growth in six years. Together with the disappointing US figures, this added to the downward pressure on the price of precious metals as it indicated that demand would fall.

At the same time, Greece admitted that without more bailout funding the prospect of defaulting on its debt could lead to a forced exit from the EU. This acted as a support for gold and helped bolster its price as it appeared to rally on Wednesday but was short-lived as the recovery was capped after European shares hit a 14-year high.

There was further disappointing data from the US new home-starts and jobless claims, as both were worse than expected. If there continues to be poor economic data, the Federal Open Market Committee (FOMC), which is due to meet later this month, could re-evaluate whether there should be an interest rate hike - if they delay, it could be a boost for the gold price.

Gold rose above the US$1,200 mark – at the same time that oil jumped to US$63 a barrel on evidence that US oil production had peaked. As is typical, the gold price rise was driven by the oil price rise.

Looking ahead

The main focus remains on what the FOMC will decide to do at the end of April but there are some other significant releases coming up.

Tomorrow the US issues its consumer price index and then next Wednesday, China releases its PMI-MFG index , which may provide further indication that the Chinese economy is slowing down.

Next week, we can also expect the US to release data for the existing home sales, new home sales as well as publish its weekly jobless claims figures, which could see gold achieve a more stable position.

 

Week on week price performances


16/04/15 16:00

Gold up 0.1% to $1,196.96,
Silver down 0.1% to $16.22,
Platinum down 0.2% to $1,151.74
Palladium up 1.2% to $770.05.

[1] PMI-MFG index: An indicator of the economic health of the manufacturing sector. The PMI index is based on five major indicators: new orders, inventory levels, production, supplier deliveries and the employment environment.

Ends

NOTES TO EDITOR
For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je

GoldMoney
GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Loomis International (formerly Via Mat), Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

Further information:
Visit: www.Goldmoney.com or view our video online
Follow us on @goldmoneynews

Dealing Desk: A heavy week of selling

Thu, 04/16/2015 - 04:52
It has been a heavy week for selling at GoldMoney, particularly out of the Loomis Swiss and UK vaults. Gold was struck the hardest, and silver followed suit, which can be attributed to speculation that an imminent US interest rate rise could pull down the price of precious metals.

Market events

On Wednesday, the European Central Bank president Mario Draghi announced that the Bank was ruling out a deposit rate cut, which indicated faith in the strength of the European economy. The US Dollar lost ground against the Euro as a result, which helped to boost gold above the psychological level of US$ 1,200.

In the US industrial output data showed that output was slower than expected, and China released figures that showed that its economy had grown by only seven per cent in the first quarter of 2015 – the slowest rate of growth in six years. These figures added to the downward pressure on the price of gold and silver.

At the same time, Greece admitted that without more bailout funding the prospect of defaulting on its debt could lead to a forced exit from the EU. This acted as a support for gold and helped bolster its price. Its price rebounded on Wednesday but the recovery was capped after European shares hit a 14-year high.

There was further disappointing data from the US new home-starts and jobless claims. Both were worse than expected. If there continues to be poor economic data, the Federal Open Market Committee – which is due to meet later this month – could re-evaluate whether there should be an interest rate hike. If they delay, it could be a boost for the gold price.

Gold rose above the US$1,200 mark – at the same time that oil jumped to US$63 a barrel on evidence that US oil production had peaked. As is typical, the gold price rise was driven by the oil price rise.

Looking ahead

The main focus remains on what the FOMC will decide to do at the end of April but there are some other significant releases coming up.

Tomorrow the US issues its consumer price index. And then next Wednesday, China releases its PMI-MFG1 index which may provide further indication that the Chinese economy is slowing down.

Next week, we can expect the US will release data for Existing Home Sales, New Home Sales and publish its weekly Jobless Claims Figures which could see gold achieve a more stable position.

Week on week price performances
16/04/15 16:00. Gold up 0.1% to $1,196.96, Silver down 0.1% to $16.22, Platinum down 0.2% to $1,151.74 and Palladium up 1.2% to $770.05.

[1] PMI-MFG index: An indicator of the economic health of the manufacturing sector. The PMI index is based on five major indicators: new orders, inventory levels, production, supplier deliveries and the employment environment.

Ends

NOTES TO EDITOR
For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je

GoldMoney
GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Loomis International (formerly Via Mat), Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

Further information:
Visit: www.Goldmoney.com or view our video online
Follow us on @goldmoneynews

Confusion over US unemployment

Fri, 04/10/2015 - 06:27
Unemployment is the one statistic that one would have thought is easy to define: just total up the number of people on unemployment benefit and there's your answer.

It is however much more complex, particularly in a large country like the United States, whose potential labour force is estimated to be 250,080,000 across all 50 states plus Washington DC. Of this total 101,479,000 are not currently employed, a ratio of over 40%, and of these only 8,575,000 are deemed to be actually unemployed. The relevant figures are here.

The reason this matters is unemployment is one of the three key variables macroeconomists use to formulate policy, the other two being GDP and the rate of price inflation. Indeed, the Fed's Open Market Committee has set the unemployment rate as one of its two policy targets. This becomes questionable at best when the officially unemployed are less than 10% of those who could be in work but are not.

Looking at the distribution of benefits doesn't help either. With benefits distributed on a rules-based system, many unemployed do not get benefits. For example, in the US there are 2,472,547 "insured unemployed" at the state level, compared with 8,575,000 officially unemployed, so less than one in three are actually on benefits and less than one in forty of those in the not-in-labour-force category, making this figure useless for policy guidance as well.

Insured unemployed are announced weekly with the Initial Claims announcement by the Department of Labor, while the number officially unemployed is announced separately by the Bureau of Labor Statistics (BLS) monthly on the first Friday of the month following. The BLS works on very tentative estimates while the insured unemployed figure, which is the hard number, forms only a small part of the overall picture.

Estimates for population growth add to the confusion. According to the BLS, the total number of people not in the labour force has actually increased over the last year to March by 279,000, though the number classified as unemployed has fallen by 1,804,000. Even these figures will be revised long after they are relevant in the light of the next population census; but on the face of it the increase in jobs is not keeping up with the estimated increase in the working population.

Job creation is an on-going process, admittedly hampered by the reluctance of banks to lend to smaller businesses, which form the bulk of any economy's activity. Despite what the GDP numbers say about growth or its absence, economic progress continues with people buying better mobile communications, new autos and flat-screen TVs. The tragedy of unemployment is that these benefits are unaffordable to most of the unemployed. It's not that they are work-shy: much of the problem is that in a zombie-like economy, scarce capital resources are not being redeployed productively while debt is mounting, so job creation becomes unnecessarily slow.

One would have thought disappointing unemployment numbers would add to the evidence that the US economy is weakening, already foreshadowed by falling commodity prices and the dramatic slide in shipping rates. We had such an event over Easter when the BLS announced non-farm payrolls was 120,000 less than expected, and the previous two months' figures were also revised downwards by a further 69,000.

Is this confirmation of an economy about to slide? Maybe, but unemployment statistics are too unreliable as an indicator and should never have been adopted as a policy tool.

 

Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Market Report: Strong dollar nips PMs rally in the bud

Fri, 04/10/2015 - 06:05
This week started well for gold and silver, but it turned out that the peak for both was on Easter Monday, since then, prices have drifted lower.

The news event that initially drove prices higher was the US unemployment statistics for March announced last Friday, which came in 120,000 less than expected with downward revisions for the two previous months totalling a further 69,000.

This was immediately taken as evidence that the Fed would defer interest rate rises until no earlier than September and possibly into 2016. This adds to growing evidence that the US economy may be stalling, but many analysts are still clinging to the hope that disappointing figures are only weather-related. Gold rallied as much as $25 and silver by $0.56, before giving up all these gains by last night. The culprit is renewed dollar strength against a low-interest market background.

For much of the time gold and silver prices hardly moved, a sure sign of lack of interest in the futures markets. Volumes were predictably low, given the Easter break, and if our experience at GoldMoney is anything to go by small sellers predominate over small buyers.

However, Open Interest in Comex futures has begun to pick up again in both metals, as shown in the two charts below.

It is equally possible that the uptick in Open Interest is due to new bull or bear positions being opened. To determine which, the relationship between price and Open Interest will have to be watched carefully, as will movements in the US dollar. For now it should be noted that gold failed to overcome the $1220 level twice in a fortnight, so will have to do some work to absorb supply apparent at that level. In silver's case the supply is established above $17.25. Prospects for next week are too close to call.

One of the reasons behind dollar strength is euro weakness, stemming from uncertainties over Greece. Yesterday Greece paid back a €459m loan to the IMF, but there are serious questions now being asked about her finances from hereon. Unless Greece is bailed out again it seems inevitable she will default, but it is difficult for Germany, for example, to justify further funding when she believes that Greece has failed to stick to the contractual terms entered into by the last government.

Germany also has her problems, with disappointing factory orders, giving more evidence of a global slow-down potentially affecting capital investment. Further confirmation of a slowdown in the Eurozone's engine could undermine the euro further.

Next week

Monday

UK: British Retail Consortium (BRC) Retail Sales Monitor.

Tuesday

UK: Consumer Price Index (CPI), Input Prices, Output Prices.
Eurozone: Industrial Production.
US: Producer Price Index (PPI), Retail Sales, Business Inventories.

Wednesday

Japan: Capacity Utilisation, Industrial Production.
Eurozone: Trade Balance, European Central Bank (ECB) Deposit Rate.
US: Capacity Utilisation, Industrial Production, NAHB House Builders' Survey, Net Long-Term (Treasury International Capital) TICS Flows.

Thursday

US: Building Permits, Housing Starts, Initial Claims.

Friday

Japan: Consumer Confidence,
Eurozone: Current Account, Harmonised Index of Consumer Prices (HICP).
UK: Average Earnings, International Labour Organization (ILO) Unemployment Rate.
US: CPI, Leading Indicator.

 

Disclaimer: The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Dealing Desk: Gold has a roller-coaster week

Thu, 04/09/2015 - 12:28
It went up and it went down, Gold rode the rollercoaster this week and at GoldMoney, customers were selling.

Kelly-Ann Kearsey, Dealing Manager at GoldMoney said, 'It was all about the sell this week. We've seen most of the gold coming out of our Swiss and UK vaults, but unusually there was even some selling out of Singapore. Despite silver being the worst performer of the week, it was gold that saw the most activity among our customers in what was a busier week than expected amid the Easter holiday. This could have been because people were selling ahead of the Federal Open Market Committee (FOMC) meeting announcement, or because we've seen gold prices reach their highest point since February and so some profit taking has taken place.'

The Net USD Flows by Metal chart, show how Gold has replaced last week's most popular seller, silver:

All about the 'US Data'
The gold price remains transfixed on US data and the state of the US economy says Kelly-Ann, 'The markets are lurching from one set of US data to another desperate for some direction. Gold rose on the disappointing US employment data last week, but the March FOMC meeting minutes intimated that although there is still some vagueness as to when the Federal Reserve might raise interest rates, there were several officials pushing for a June rise which gave the dollar some support. We could see some renewed support for gold from the continuing economic situation in Greece and the threat of an exit from the Euro, so that's still a situation to be watched.

What next?
'Monday in particular will be a busy day for figures from the US and China' says Kelly-Ann, 'so we're expecting next week to be another where the market focuses on data for any signs that the US economy is still progressing and not slipping backwards.'

Week on week price performances
09/04/15 16:00. Gold down 0.1% to $1,195.60, Silver down 2.2% to $16.23, Platinum up 0.2% to $1,154.24 and Palladium rose 1.4% to $760.65.

 

NOTES TO EDITOR

For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je

GoldMoney
GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Loomis Internation (formerly Via Mat), Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

Visit: Goldmoney.com or view our video online

STEP – Tax, Trusts & Estates Conference 2014

Wed, 04/08/2015 - 06:07
GoldMoney are delighted to be sponsoring the Tax, Trusts and Estates STEP Conference 2015 in London on 8th May.

Packed with quality content, this conference provides essential guidance on the current and future developments in tax, trusts and estates. Delivered by the profession's leading minds, sessions will cover: increasing statutory rules and regulations (affecting not just taxpayers but also trustees and practitioners), probate and succession, and the Care Act and pensions revolution. Speakers include Chris Whitehouse TEP, Prof Lesley King, Lucy Obrey TEP and George Hodgson.

Meryl Le Feuvre, Marketing Manager at GoldMoney commented: 'I look forward to representing GoldMoney at this prestigious event. GoldMoney has supported STEP for the last two years. The calibre of the speakers is one of the key attractions to this event for us.'

For more information about the Conference click here.

Dealing Desk: Low volumes and activity but key figures out on Good Friday

Thu, 04/02/2015 - 11:57
This week has seen net selling across precious metals – particularly of silver and gold, while platinum and palladium have been fairly neutral.

A trend of note has been selling out of the Swiss vaults. Any buying has come from the Brink's Canada Vault. This has become more of a trend over the past two to three weeks so could be a new favourite.

Net selling continues to be much higher than metal buying this week due to a number of factors – not least the month end, the end of the first quarter and the end of the financial year.

But overall, there has been relatively low activity this week because of the Easter holiday.

Overview of the week

At the beginning of the week gold pulled away from its three-week high as the US Dollar gained and gold dropped.

The US Dollar climbed after Federal Reserve Chair Janet Yellen signalled that the US Central Bank might raise interest rates later this year. The US Dollar also strengthened against the Euro and other major currencies, which served to pull on the gold price.

There was also continuing geo-political tension in the Middle East, with Saudi Arabian launching air strikes against in Yemen.

On Tuesday, Palladium rebounded from its 13-month low. Gold continued to drop based on expectations of the US Federal Reserve and uncertainty over US employment figures, which are due to be published on Good Friday. These significant figures have the potential to lift expectations of an interest rate rise.

On Wednesday morning, Gold steadied after the quarter-end and year-end of the previous day but it later rose after weaker-than-expected economic data was published. This pushed Gold above $1,200 an ounce. European prices hit an eight-week high after the release of US job data, which was well below the forecasts of analysts.

This was compounded by data on US construction and manufacturing spending, which was also below expectations. The price of Gold continued to rise into Thursday.

What's next?

The US employment figures, released on Good Friday, will be one of the most significant events in the week ahead. On Monday, the US releases its non-manufacturing index and on Wednesday, the release of minutes of the last Federal Open Market Committee could cause some volatility in the Gold price. Next Thursday, US jobless claims figures will be published as will the China Consumer Price Index.

Week on week price performances
02/04/15 16:00. Gold down 0.6% to $1,96.70, Silver down 2.9% to $16.59, Platinum up 0.3% to $1,152.50 and Palladium down 2.2% to $750.15.

NOTES TO EDITOR

For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je

GoldMoney
GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Loomis Internation (formerly Via Mat), Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

Visit: Goldmoney.com or view our video online

Valuing gold - USD FMQ Update

Thu, 04/02/2015 - 10:30
There is only one way to value gold, and that is to quantify the expansion of the fiat currency in which it is priced.

That is the sole purpose of the Fiat Money Quantity (FMQ), which since I last wrote about it five months ago has increased by $375bn to $13.7 trillion. This is despite the end of quantitative easing, which had been tapered down before being abandoned altogether. The long-term chart of FMQ is shown below.

FMQ is the total instant-access cash and deposits in the commercial banks plus their reserves at the Fed and the temporary means by which those reserves are changed. Its purpose is to quantify the difference between sound money and fiat currency by including the steps by which gold has been progressively absorbed into the banking system from private ownership and into government vaults via the commercial banks and the Fed. A fuller description can be found here.

The pace of FMQ creation from 2008 continues well above the pre-Lehman crisis trend, and it is now $8,259bn higher than at that time, an increase of 152% in 78 months. Who would have thought that a temporary provision of money and credit to stabilise the financial system in the wake of the Lehman crisis would have developed such permanency?

As a measure of monetary inflation, FMQ differs from more conventional metrics by including liquid bank assets held on the Fed's balance sheet. By including money parked out of sight in this way a truer position is obtained. Critics of this approach say it is double-counting, because bank reserves recorded at the Fed are also recorded at the commercial banks as customer deposits. This is undoubtedly true, but the whole fractional reserve system involves multiple counting of the same underlying money, so it is hardly disqualified on these grounds.

The next chart shows how FMQ has deflated the price of gold, measured in constant 1934 dollars. This was the year that President Roosevelt devalued the dollar from $20.67 to $35 per ounce of gold.

The gold price is shown in nominal US dollars and also in constant 1934 dollars adjusted for the increase in FMQ; the disparity between these two prices has widened over the years to $1,211 and $3.91 respectively. The two previous times the adjusted gold price hit these low levels were in April 1971 at $3.31, four months before President Nixon was forced to suspend the Bretton Woods Agreement, and in October 2001 at the start of the last bull market when it got down to $3.45. This time, the higher rate of increase in FMQ suggests the price today is more undervalued than the two previous times on a forward-looking basis[1].

The last chart is of the gold price since the Lehman crisis and in July 2008 constant dollars, when FMQ accelerated above the long-term trend as shown in the first chart.

While the nominal price taken in February 2015 was $1211, the adjusted price was $480, representing a 45% fall from the $918 price in July 2008.

In summary, FMQ shows that gold is substantially under-priced in dollars on a long-term value basis. In the past this level of under-pricing has been followed by major price shocks to the upside on both occasions.

[1] Note: previously I deflated the gold price by the increase in above-ground stocks. I am persuaded this is not necessary because the growth in mined gold is approximately the same as global population growth.

Disclaimer - The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Market Report: Precious metals hold their own over Q1

Thu, 04/02/2015 - 10:11
Gold priced in dollars hardly changed over the first quarter of 2015, but silver performed strongly, up 7%.

In generally choppy markets across all asset classes silver was bettered only by the Nikkei 225 Index. This compares with the NASDAQ up 3%, the US long bond up 2.6%, and the Standard &Poors up 1%.

The consensus opinion that the dollar will continue rising is almost total, which is the other side of the gold trade. But while the dollar has risen, gold has not fallen: in other currencies it has gained, the principal exception being priced in yen, which has been consolidating against the dollar after last year's weakness. Gold priced in the other major currencies is shown in the next chart.

Being unchanged in dollars over the quarter, gold outperformed most other asset classes, with crude oil down 15%, the euro 12.2%, sterling 5.1%, and copper 2.2%. The performance of both gold and silver is against a background of growing pessimism about global deflation relative to the US, with the Managed Money (MM) category for gold on Comex increasing short positions to record levels, shown in the next chart which is updated to Tuesday last week.

Hedge funds selling gold futures are buying the dollar and not necessarily expressing a view about gold, other than something has to be sold to buy the dollar. Therefore, if there is a change in sentiment against the dollar, this could have a dramatic effect on gold and silver prices because it would almost certainly trigger a substantial bear squeeze.

This market condition appeared to drive prices higher in trading on Wednesday, the first day of the new quarter. Up to that point a range of markets appeared weak ahead of quarter-end book-squaring, an influence that has now passed. Gold rose as much as $27, or over 2% on Wednesday before settling at $1204. Silver moved up as much as $0.55, or 3.3%, before settling at $16.95.

Overall, trading is subdued by the Easter break, with many markets closed on both Good Friday and Easter Monday.

Looking forward into the second quarter, the principal concern has to be the unanimity of opinion that the dollar reigns as king over everything else. The certainty with which the overwhelming majority of hedge funds, banks and other investors hold this view is reminiscent of investor psychology in September 1987, when just a few weeks' later equity markets suddenly crashed for no reason other than everyone was fully invested and no one left to buy. If the dollar does have a major correction, it should be reflected in an improved outlook for precious metals starting from a sound base.

Next week

Monday

Japan: Leading Indicator.
Eurozone: Sentix Indicator.
US: ISM Non-Manufacturing Index.

Tuesday

UK: Halifax House Price index, CIPS/Markit Services PMI.
Eurozone: Composite PMI, PPI.
US: IBD Consumer Optimism, Consumer Credit.
Japan: Current Account

Wednesday

Eurozone: Retail Trade.
Japan: BoJ MPC Overnight Rate, Economy Watchers Survey.

Thursday

UK: Trade Balance, BoE MPC Meeting and Rate Decision.
US: Initial Claims, Wholesale Inventories.
Japan: Bank Lending Data.

Friday

UK: Construction Output, Industrial Production, Manufacturing Production.
US: Import Price Index, Budget Deficit.

 

Disclaimer - The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Expand your grandchildren's waistlines or financial security?

Mon, 03/30/2015 - 05:04
In most countries at this time of year, the shops are stacked ith chocolate Easter eggs or cute bunny and chick toys, but what if you want to give your grandchildren something they can really remember you for?

Most children nowadays get a month's worth of chocolate in one hit, and it's gone in a flash. With the new pension changes coming into effect in the UK just in time for Easter, research suggests that many grandparents are thinking about taking some cash out of their pension, investing it elsewhere and helping children and grandchildren.

Anyone who had a private pension linked to the stock market in 2008 watched in horror as approximately £150billion was wiped off money-purchase pension schemes; those who were just about to retire were worst hit. It became clear that the most important financial decision you can make with regard to your pension portfolio, is to make sure it is balanced and invested broadly.

Fast forward a few decades and the young people of today are predicted to be in a far worse position when they are grandparents. The high cost of housing means many cannot even dream of owning their own home, and then of course there is the double edged sword of us generally living longer and the resulting costs.

You could just give your grandchildren some cash, but with interest rates still at record lows it is unlikely they will make enough interest on it to keep up with inflation. Gold, however, has been used as an inflation protector for centuries. It has the lowest correlation to the global business cycle, so that means if the stock exchange suddenly takes a dive, historically gold goes up. It is also an excellent preserver of purchasing power. It is not the kind of investment you would make to score a quick profit, it is there to provide a financial safety net in a volatile world.

We are of course talking about the physical metal itself and not exchange traded funds (ETFs), and it must be investment grade bullion, which is best kept in a secure, independent and audited storage facility. Of course past trends are not a guarantee of what will happen in the future, but it is important to realise that in 500-600 years BC, 350 loaves of bread cost one ounce of gold. You would still get roughly the same number of loaves today for your ounce; meanwhile national currencies have come and gone.

Over the past few years the world's biggest gold purchasers have been in China and the India – the two most populous nations, and rising industrial powers. Gold has been flowing out of western vaults into the East at a fast rate, this is a global asset, not a national one.

It is easier than you think to own gold. You can buy online at goldmoney.com and choose where around the world you would like your gold stored. All the vaults are outside of the banking system and run by global security experts.

So, whether you want to diversify your pension and put some of it into an asset known for its long term wealth protection (gold is included in the list of approved assets for a Self-Invested Personal Pension SIPP), or give your grandchildren that nest egg which will help protect their financial future, gold could be a good choice. After all, going back to school after the Easter holidays and being able to say, 'My grandparents bought me a real gold bar for Easter', is going to be a much better story to tell than, 'I got another chocolate egg'!

ENDS

GoldMoney nor its representatives provide financial, legal, tax, investment, or other advice. Advice should be sought from an independent regulated person who is qualified to do so. Any information provided is solely as general market commentary and is not advice.

Central banks paralysed at the zero bound

Fri, 03/27/2015 - 08:07
Though the Fed would deny it, it is clear from the minutes of the last Federal Open Market Committee (FOMC) meeting that a rise in interest rates has been put off indefinitely.

The subsequent rally in the price of gold and the sudden fall in the dollar tend to confirm this conclusion.

The Fed Funds Rate, which is the interest rate the Fed targets to set all other rates, has now been less than 0.25% for six and a quarter years, gradually declining from roughly 0.15% to about 0.10% today. It was set at a target range of between zero and 0.25% in December 2008.

According to the Policy Normalisation Principles and Plans issued last September, the FOMC will raise its target range for the Fed Funds Rate "primarily by adjusting the interest rate it pays on excess reserve balances" when the Fed normalises interest rates, "using reverse repurchase agreements to take money out of circulation to the degree necessary". The Fed also intends to reduce its holdings of securities and contract its balance sheet in the longer run.

If normalisation is the result of economic recovery we will be familiar with the playbook. Demand for money in the economy picks up, and instead of pyramiding bank credit on reserves held at the Fed, the Fed feeds back the excess reserves to the banks by selling government securities into the markets. The bear market in government bonds should be manageable because of underlying pension and insurance company demand coupled with a diminishing budget deficit. This is the long-understood theory behind withdrawing from deficit financing.

The reality has been very different as we all know. The Fed has to face the possibility that, for whatever reason, highly suppressed interest rates are not working, and an escape from the zero interest rate bound without economic recovery may have to be contemplated.

However, if the Fed raises the Fed Funds Rate in the absence of genuine economic recovery, there will be little or no expansion of bank credit to offset, and commercial banks will want to dump their Treasuries, not buy more from the Fed. There would be no offsets to cushion the unwinding of long bond positions. In other words the effect of even a small rise in the Fed Funds Rate could develop into a self-feeding rise in bond yields and substantial losses for the banks.

This is the context within which we should consider the Fed's decision to back off from raising the Fed Funds Rate mid-year. It leads to the conclusion that if zero interest rates haven't worked for six and a quarter years, monetary policy itself is in a cul-de-sac with no space to turn. And when we look at Japan and the Eurozone we see similar disappointments over the effectiveness of monetary policy.

Markets are unlikely to wait until the escape from the zero bound is put to the test. Before the investing public becomes aware of the full ramifications of the problem, more prescient bankers and fund managers will reposition their bond holdings, which brings us to gold.

Those of us that follow this market closely know that for the last three years at least Asian demand has led to large shifts of bullion from western capital markets towards Asia. The behaviour of the markets in London and New York already indicate that shortages of physical bullion are a delicate problem, and this is before markets wake up to the growing likelihood that the Fed cannot afford to see interest rates rise.

If interest rates cannot rise, then the dollar itself is ultimately exposed to loss of confidence in the foreign exchanges. The dawning realisation that after recent strength, the dollar is vulnerable after all can be expected to be reflected in a positive sentiment towards gold, which once under way could drive the price up dramatically due to the lack of available bullion.


The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information.

Market Report: FOMC minutes turned the tide

Fri, 03/27/2015 - 07:51
Following the release of the Federal Open Market Committee (FOMC) minutes last week, gold and silver have come alive, the gold price rising from a low of $1147 on 18th March to $1200 this morning and silver from $15.46 to $17.00, 4% and 10% increases respectively.

The Commodity Futures trading Commission's (CFTC) Commitment of Traders Report released last Friday conveniently shows the positions of trading categories the night before the FOMC minutes were released. In gold, the Managed Money category sold down their positions to the lowest net long position since December 2013. This is shown in the chart below, with the dotted line representing the average net long position since 2006.

This represents a dramatic turnaround in positions, and it has permitted the Swaps (mostly bullion banks) category to reduce its net short position substantially, shown in the next chart.

This confirms that the Managed Money category, consisting mostly of hedge funds, was badly wrong-footed ahead of the FOMC release, being very short indeed. In other words, there has been a significant bear squeeze subsequently which has driven the gold price sharply higher.

A simple bear squeeze should be accompanied by a decline in Open Interest, because a bear squeeze forces wrong-footed traders to close their loss-making positions. However, Open Interest has been increasing, which it turns out is entirely due to an increase in spreads1. Since Wednesday, Open Interest has declined sharply, which suggests that spread positions have been closed as the April contract runs off the board. This is shown in the next chart.

The presence of spreads, which are neither bullish nor bearish, negates the hope that the recent increase in Open Interest is due to genuine demand. Instead, we must conclude that dollar weakness after a period of significant strength has much to do with the rise. Oil prices have rallied strongly as well, having been oversold, confirming that markets so far appear to be only correcting the moves of the last eight weeks.

However, there are fundamental reasons for a more bullish stance for gold, not least the dawning realisation that the FOMC minutes from last week effectively put off interest rate increases indefinitely. Whatever else is a threat to the world's financial credibility, and you could make a very long list of those, the Fed's admission that for the foreseeable future there is no exit from continuing monetary inflation fully justifies a more positive trend for precious metal prices.

The Shanghai Gold Exchange delivered 53.47 tonnes into public hands last week, making a total of 561 tonnes so far this year, a slight increase on last year.

1 Spreads are matching long and short positions designed to profit from price differentials after financing between different maturities

Next week

Monday

UK: BoE Mortgage Approvals, Net Consumer Credit, Secured Lending, M4 Money Supply.
Eurozone: Business Climate Index, Economic Sentiment, Consumer Sentiment, Industrial Sentiment.
US: Core PCE Price Index, Personal Income, Personal Spending, Pending Home Sales.

Tuesday

Japan: Construction Orders, Housing Starts.
UK: Current Account, GDP (3rd Est.), Index of Services.
Eurozone: Flash HCIP, Unemployment.
US: S&P Case-Shiller Home Price, Chicago PMI, Consumer Confidence.
Japan: Tankan Survey.

Wednesday

Eurozone: Manufacturing PMI.
US: ADP Employment Survey, Manufacturing PMI, Construction Spending, ISM Manufacturing.

Thursday

UK: CIPS/Market Construction Survey.
US: Initial Claims, Trade Balance, Factory Orders.

Friday

US: Non-farm Payrolls, Unemployment.

The views and opinions expressed in the article are those of the author and do not necessarily reflect those of GoldMoney, unless expressly stated. Please note that neither GoldMoney nor any of its representatives provide financial, legal, tax, investment or other advice. Such advice should be sought form an independent regulated person or body who is suitably qualified to do so. Any information provided in this article is provided solely as general market commentary and does not constitute advice. GoldMoney will not accept liability for any loss or damage, which may arise directly or indirectly from your use of or reliance on such information. 

Dealing Desk: Precious metal prices up – GoldMoney customers cash in

Thu, 03/26/2015 - 12:56
Gold prices reached a three and a half week peak this morning, rising above the critical $1200 resistance level, but while more GoldMoney customers have been buying along with the rest of the market, there have also been some big value sales resulting in net value selling.

The chart below shows net sell orders this week, compared to buying last week for gold among GoldMoney customers.

Gold fortunes up
Kelly-Ann Kearsey, Dealing Manager, said: 'There has actually been limited trading this week among our customers, with the most notable activity prior to last week's Federal Open Market comments. Since then we've seen gold's price gradually rise while the dollar has headed south as the prospect of an imminent rate rise receded.

Geopolitical = Safe haven
'Prices peaked this morning on geopolitical tension following news about the increased military action in Yemen.' Says Kelly-Ann, 'There was a resulting decline in global stocks markets coupled with rising oil prices and gold is still above the $1200 resistance level despite slipping back slightly, no doubt helped by the US jobless claims figures giving some support to the dollar. '

Silver Shines
However, it's silver which has seen the biggest price jump of the week, rising over 6% to above its $17 resistance level. 'German data strengthened the Euro against the dollar which has helped, but that still failed to interest our GoldMoney customers. As you can see from the graph below, they have been selling silver on most days this week.'

What's next?
There is US economic data out next week, not least the US GDP, which could give further indicators, and next Thursday Federal Reserve head, Janet Yellen is speaking, which might give some volatility to the market. Longer term, the World Gold Council has said China should increase its gold holdings to help diversify currency risks. It's suggesting 5%, and as China is only currently holding around 1.6%, that could translate into a big rise in demand from China should they choose to follow the advice.'

Week on week price performances
26/03/15 16:00. Gold up 2.9% to $1,204.16, Silver up 6.1% to $17.09, Platinum up 2.7% to $1,149.49 and Palladium unchanged at $767.03.

NOTES TO EDITOR

For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je

GoldMoney
GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Via Mat, Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

Visit: Goldmoney.com or view our video online

Bunnies hop for joy

Thu, 03/26/2015 - 12:43

26th March, 2015

Bunnies hop for joy with charity bonanza

There was lots of hopping, skipping and chocolate eating this week as the third annual Grace Crocker Bunny run got underway. Teams of bunnies, supported by GoldMoney staff, visited nurseries and schools across the island with an estimated £2,500 raised for the charity.

The event is sponsored by GoldMoney and organised by the company's Chief Financial Officer, Pete Wright, and his wife Rachel. 16 schools and nurseries signed up for a visit from the bunnies with entertainment support from registered sports coaching and playcare club, Sports Bug Jersey.

Pete Wright says it was hard work but a lot of fun, 'We were really lucky with the weather, and to see the smiles on all the children's faces was a joy. We had five teams of bunnies, plus support staff, and we were fortunate to have the Sports Bug Jersey team helping us out with Easter fun games. Most importantly, we have raised money for the Grace Crocker Foundation'.

Grace Crocker was born in Jersey with hypo-plastic left heart syndrome and had open heart surgery at just five days old. Grace's family had to move to Southampton for three months to be with her, but sadly Grace died aged just 11 weeks. The charity aims to help other families who have to go off island when a child is seriously ill, and gives financial and emotional assistance.

Geoff Turk, Chief Executive Officer, GoldMoney commented: 'As a company we thoroughly enjoyed helping Pete and the Grace Crocker Foundation, not only through sponsorship, but Pete's colleagues got into the spirit of it all and dressed up as bunnies or helped in the support crew. This fantastic initiative has raised well over £9,000 over the three years so well done to Pete and his crew.'

Nurseries and schools which took part on Wednesday 25th March:
Silverstar
Rainbow Tots
St Peter School
Samares Nursery
Charlie Farleys
Samares Reception
Little Oaks
Charlie Farleys too
Leeward
Trinity School
Rainbow Tots Beaumont
Little Oaks
Nestlings
D'Auvergne
Petit Ecole Fort
St Lawrence School

Further information and photos from the day are available on The Grace Crocker Bunny Run Facebook page.

Further information about the charity and donations can be made through their website: www.gracecrocker.org

Ends

NOTES TO EDITOR
For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je

GoldMoney

GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.


Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Via Mat, Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

Further information: Visit: www.Goldmoney.com

STEP – Annual Jersey Conference

Tue, 03/24/2015 - 05:59
GoldMoney are delighted to be exhibiting at the 2015 Annual Jersey Conference taking place at the Royal Yacht Hotel on 24th April 2015.

The Jersey Branch of STEP, which was established in 1993, is one of the largest and most active in the world. The Conference is the perfect platform for GoldMoney to engage with Jersey based institutions to provide an insight on how precious metals can be included within an investment portfolio.

Meryl Le Feuvre, Marketing Manager at GoldMoney commented: 'GoldMoney is delighted to support STEP for the second year running. I look forward to representing GoldMoney at this prestigious event and meeting up with our clients and partners.'

For more information about the Conference click here.

The new order emerges

Fri, 03/20/2015 - 08:08
China and Russia have taken the lead in establishing the Asian Infrastructure Investment Bank (AIIB), seen as a rival organisation to the World Bank and the Asian Development Bank, which are dominated by the United States with Europe and Japan.

These banks do business at the behest of the old Bretton Woods* order. The AIIB will dance to China and Russia's tune instead.

The geopolitical importance was immediately evident from the US's negative reaction to the UK's announcement this week that it would join the AIIB. And very shortly afterwards France, Germany and Italy also defied the US and announced they might join. In the Pacific region, one of America's closest allies, Australia, says she is considering joining too along with New Zealand. The list of US allies seeking to join is growing. From a geopolitical point of view China and Russia have completely outmanoeuvred the US, splitting both NATO and America's Pacific alliances right down the middle.

This is much more important than political commentators generally realise. We must appreciate that anything China does is planned well in advance. Here is the relevant sequence of events:

• In 2002 China and Russia formally adopted the founding charter for the Shanghai Cooperation Organisation, an economic bloc that today contains about 35% of the world's population, which will become more than 50% when India, Pakistan, Iran, Afghanistan and Mongolia join, which is their stated intention. Russia has the resources and China the manufacturing power to develop the largest internal market ever seen.

• In October 2013 George Osborne was effectively summoned to Beijing because China wanted London to be the base to develop renminbi-denominated financial instruments. London has served China well, with the UK Government even issuing the first renminbi-denominated foreign (to China) government bond. The renminbi is now on the way to being a fully-fledged international currency.

• The establishment of an infrastructure bank, the AIIB, will ensure the lead funding is available for the rapid development of road, rail, electric and electronic communications throughout the SCO, ensuring equally rapid economic development of the whole of the Asian continent. It could amount to the equivalent of several trillion dollars over time.

The countries that are applying to join the AIIB realise that they have to be members to access what will eventually become the largest single market in the world. America is being frozen out, the consequence of her belligerence over Ukraine and the exercise of her hegemonic power through the dollar. America's allies in South East Asia are going with or will go with the new AIIB, and in Europe commercial interests are driving America's NATO partners away from her, turning the Ukraine from a common cause into a festering liability.

The more one thinks about it, the creation of the AIIB is a masterstroke of tactical genius. The outstanding issue now is China and Russia will need to come up with a credible plan to make their currencies a slam-dunk replacement for the dollar. We know that gold may be involved because the SCO members have been accumulating bullion; but before we get there China must manage a deliberate deflation of her credit bubble, which will be a delicate and dangerous task.

Unlike the welfare-driven economies in the west, China has sufficient political authority and internal control to survive a rapid deflation of bank credit. When this inevitably happens the economic consequences for the west will be very serious. Japan and the Eurozone are already facing economic dislocation, and despite over-optimistic employment numbers, the US economy is faltering as well. The last thing America and the dollar needs is a deflationary shock from China.

The silver lining for us all is a peace dividend: it is becoming less likely that America will persist with a call to arms, because support from her allies is melting away leaving her on her own.

 

*The Bretton Woods system of monetary management established the rules for commercial and financial relations among the world's major industrial states in the mid-20th century.

-Disclaimer- The views and opinions in this article are those of the author, do not reflect the views and opinions of GoldMoney, and are not advice.

Market Report: FOMC is boxed in

Fri, 03/20/2015 - 06:38
The Federal Open Market Committee (FOMC) statement released on Wednesday was notable for deferring interest rate rises to some unspecified time in the future.

This was realistic, given the continuing strength of the dollar, downward revisions to the inflation outlook, and economic weakness in virtually all industry surveys. The Fed's obvious problem in deferring a rise in interest rates is the continuing improvement in the unemployment statistics. However these are seriously flawed: for example in February housing starts fell sharply due to the bad weather, yet seasonally adjusted non-farm payrolls for residential construction jobs were said to rise by 17,200.

It appears the Fed is boxed in, and raising the Fed funds rate would probably only serve to increase excess reserves. If so, the Fed would have to shell out interest payments to the banks at a rate it really cannot afford, given its own balance sheet is geared over 70 times. Markets seem to be slow to understand this problem: if the Fed is unable to raise interest rates (i.e. the Fed funds rate) the dollar itself is at risk.

The immediate effect on precious metal prices was to turn them sharply higher, and Open Interest on Comex has continued to climb. Gold was up a net $16 on the week and silver $0.55. Oversold currencies bounced strongly, but gave back most of their gains yesterday. The set-up is now for a bear squeeze in gold and silver, with the Managed Money category on Comex somewhat short. The chart for gold and its Open Interest is shown below.

Silver has continued to resist moves to the downside, and here the Open Interest has continued its climb as well. Silver has outperformed gold, illustrated in the chart at the head of this report.

Normally falling prices are accompanied by lower Open Interest. The current divergence is therefore indicative of increased buying support, which may be enough to reverse the bear trend of the last three years.

It has been a momentous week, and rarely do so many important events occur. As well as the Fed showing they dare not or cannot raise interest rates, Greece's negotiations with the other Eurozone members are stranded on the rocks of reality. This was the week when markets suddenly realised the UK faces a general election with considerable political risk so sterling was sold heavily. The UK, Germany, France, Italy, Luxembourg and Switzerland are queuing up with probably Australia and New Zealand to become members of the Chinese and Russian led Asian Infrastructure Investment Bank, compromising NATO and Pacific alliances. Unfortunately for American hegemony, the political line-up is following an economic interest, and this is a party to which America does not have an invitation.

If all that is not enough, the London gold fix changes this morning after ninety-six years from a committee to a platform run by the International Commodity Exchange. Participants (the approximate equivalent of market makers) announced so far are Barclays, HSBC, Scotiabank, Société Generale and UBS. It is interesting that the American and Chinese houses are holding back.

GoldMoney's customers sat on their hands ahead of the FOMC announcement, turning buyers after the event, according to our dealing desk.

Wholesale gold bullion deliveries from the Shanghai Gold Exchange amounted to 51.456 tonnes last week, totalling 507.71 tonnes since 1st January.

Next week

Monday

UK: CBI Distributive trades, Industrial Trends.
Eurozone: Flash Consumer Sentiment.
US: Existing Home Sales.

Tuesday

Eurozone: Flash Composite PMI.
UK: CPI, Input Prices, Output Prices, ONS House Prices.
US: CPI, FHFA House Price Index, Flash Manufacturing PMI, New Home Sales.
Japan: CSPI.

Wednesday

UK: BBA Mortgage Approvals.
US: Durable Goods orders.

Thursday

Eurozone: M3 Money Supply.
UK: Retail Sales.
US: Initial Claims.
Japan: CPI, Real Household Spending, Unemployment, Retail Sales.

Friday

US: Core PCE Price Index (3rd Est.), GDP (3rd Est.), GDP Price Index (3rd Est.).

Dealing Desk: Gold back in favour, but silver out-shines

Thu, 03/19/2015 - 13:39
After a hesitant week ahead of the Federal Reserve Open Market Committee minutes being released, gold saw a flurry of interest today.

Gold in Favour
Gold prices edged lower Tuesday ahead of Janet Yellen's much anticipated comments, says Kelly-Ann Kearsey, Dealing Manager at GoldMoney. 'Our customers were definitely sitting on the sidelines with customer activity at a real low just ahead of the release. The message was that the Federal Open Market Committee (FOMC) still wants to prime the markets for a hike, but it is taking a more dovish stance which has been enough to send our customers back to gold buying, as both gold and oil prices saw a quick rebound and the dollar dipped.'

Gross Orders (Buy + Sell) : Volume per day (in USD)

But... Silver outshines
It has not been a clear cut preference though, Kelly-Ann says, 'While there have been more buyers of gold, there have been larger orders for silver which has been reflected in a slight improvement in silver's ratio against the yellow metal. Nevertheless, silver still remains relatively cheap compared to gold. It will be interesting to see if this week's return to silver will be maintained.'

Platinum plummet
Meanwhile, platinum has fallen 8% since the start of the year and still remains below the gold price. 'We have seen more buying across all our metals, including some interest in platinum.' Says Kelly-Ann, 'However the demand fundamentals for platinum, with a reduction in diesel car manufacturing in Europe, seem to be against it from the industrial point of view, and it will remain to be seen where the metal heads longer term.'

Eastern promise
The two Singapore vaults have seen the most buying interest again this week, with Canada coming in third. The Canadian vault has seen more buying going into it in the last few weeks. 'The shift of precious metals to the eastern vaults has been ongoing for some time, and we are unlikely to see this changing.' Says Kelly-Ann.

What next?
Today is the final day of the London Gold Fix, with tomorrow (Friday) the start of the electronic London Bullion Market Association Gold Price. 'While this is unlikely to affect customer activity,' says Kelly-Ann, 'It will provide market commentators with some interest. Meanwhile, for our customers, there is more US data out next week which will give further direction to the market and indication of when those US rates might rise. The chart below gives an interesting indication of how our GoldMoney customers react compared to market prices.'

Net USD Gold Orders per day vs Gold Daily Performance

Week on week price performances
19/03/15 16:00. Gold up 1.7% to $1,170.52, Silver up 3.8% to $16.10, Platinum up 0.5% to $1,119.15 and Palladium down 2.3% to $767.25.

NOTES TO EDITOR

For more information, and to arrange interviews, please call Gwyn Garfield-Bennett on 01534 715411, or email gwyn@directinput.je

GoldMoney
GoldMoney is one of the world's leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney's non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink's, Via Mat, Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

Visit: Goldmoney.com or view our video online

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