Dealing Desk: Gold resumes safe haven stance

This week has seen net buying in both gold and silver, with platinum and palladium experiencing some selling.

GoldMoney's Singapore vaults have continued to be the most popular this week alongside our Canadian vault, which has received renewed interest from clients. Sell orders have been seen mostly in the Swiss vault this week.

Kelly-Ann Kearsey, Dealing Manager at GoldMoney, says that this week we have continued to experience a vollitile market. While last week saw the rise of gold to over USD1,100/oz, this week has seen gold trading between USD1,080.00/oz and just below USD1,100.00/oz. There has been a similar effect with silver trading between USD 13.75/oz and over USD14.00oz.

Both gold and silver prices have been put under pressure due to the recent stabilization of the Chinese stock markets in which they have tested their levels of resistance. This has been offset by the safe haven demand that has supported the metals due to continued tensions in the Middle East. This has also been supported due to a falling global equity market and weakness in the US Dollar, which fell against a basket of major currencies.

According to the World Gold Council, central banks have added 55 tons of gold to their reserves in November 2015 which is an increase from the 29 tons added in October 2015, which will also provide more guidance for the yellow metal.

Platinum and Palladium have experienced some larger price losses this week. On Tuesday, platinum was trading at its cheapest price compared to gold since 1987. At this point, clients were purchasing one ounce of platinum for 0.77 ounces of gold which was the lowest point.

Platinum has been underperforming gold since 2014 as it has been considered more of an industrial metal than an investment asset. The metal has suffered due to the slowdown in China alongside the Volkswagen incident which decreased consumer demand for diesel fueled vehicles.

Palladium has slipped to a 5 year low which was affected by weaker demand for the metal from China, who is one of the world's biggest buyers of the metal and also Chinese car sales figures had increased at their slowest pace in three years.

14/01/16 16:00. Gold lowered 1.9% to $1,082.01, Silver decreased 2.2% to $13.79, Platinum declined 4.2% to $838.64 and Palladium dropped 1.3% to $488.30 Gold/Silver ratio: 78

NOTES TO EDITOR
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