• Tag Archives India
  • Asian Metals Market Update: June-20-2017

    Factors which can affect markets
    It should be a technical trade as there is no news. Geopolitical risk will be closely watched. This is the last week before Ramzan ends. Over the past decade there is a big spike in smuggled gold in India after Ramzan. Physical gold premiums can fall after two weeks. (unless gold prices continue to fall). Investors are happy due to continuation of bullish trend in stock markets.
    Trend is down for gold and silver. One needs to look for signs of trend reversal.
    COMEX GOLD AUGUST 2017 – current price $1247.01
    Bullish over $1253.20 with $1260.20 and $1268.70 as price target
    Bearish below $1249.10 with $1244.40 and $1237.10 as price target.
    Neutral Zone between: $1249.10-$1253.20

    This post was published at GoldSeek on 20 June 2017.

  • Proposed Hallmarking Program Could Boost Confidence for Indians Buying Gold

    Late last month, the gold trading industry in India announced plans to set up 100 hallmarking centers, and establish a precious metal assay and training institute in an effort to ensure the purity of gold sold in the country.
    According to the Economic Times of India, ‘Indian Association of Hallmarking Centres has submitted a proposal to the Bureau of Indian Standards to issue a certificate along with each jewelry sold, capturing its photo, purity, weight and the names of the center that put the hallmark and the jeweler who sold it.’
    Gold hallmarks show the purity of a piece of gold jewelry. They generally include the mark of the assaying office that certified the purity, as well as the fineness or caratage of the gold.
    ‘Caratage’ is the measurement of purity of gold alloyed with other metals. Pure gold is certified as 24 carat. The lower the number the less gold the metal contains. For example, 18 carat gold contains 75% gold and 25% other metals.

    This post was published at Schiffgold on JUNE 19, 2017.

  • SWOT Analysis: Is India’s Gold Market Recovering?

    The best performing precious metal for the week was gold, off just 1.02 percent despite a Fed rate hike. The Fed may not be in a position to continue with multiple rate hikes. Mike McGlone, BI Commodity Strategist, points out the current situation that both crude oil futures and Treasury bond yields are falling. Since 1983, the Fed has never sustained a rate hike cycle while both crude and Treasuries are falling. Gold has risen from a three-week low as investors digest the latest rate hike and anticipate the probability of additional rate hikes, reports Bloomberg. Suki Cooper, an analyst with Standard Chartered, writes, ‘If the market starts pricing in the end to the current hiking cycle, this would remove a major headwind for gold and allow prices to breach the stubborn $1,300 threshold in a sustained move higher.’ Bloomberg reports that public sector investors increased their net gold holdings to an estimated 31,000 tons last year, an increase of 377 tons. This is the highest level since 1999. Weaknesses
    The worst performing precious metal for the week was silver with a loss of 2.90 percent. Money managers cut their net-long by about 10 percent this past week. For the second week in a row, gold traders and analysts surveyed by Bloomberg are bearish. This is the first time survey results have indicated two-week run of bearish outlook since December. Gold futures have had the longest losing streak in three months, as investors have anticipated the Fed’s actions this week. Bullion futures for August delivery closed down for the fourth straight session earlier this week.

    This post was published at GoldSeek on Monday, 19 June 2017.

  • Jayant Bhandari on Gold, Submerging Markets and Arbitrage

    Maurice Jackson Interviews Jayant Bhandari We are happy to present another interview conducted by Maurice Jackson of Proven and Probable with our friend and frequent contributor Jayant Bhandari, a specialist on gold mining investment, the world’s most outspoken emerging market contrarian, host of the highly regarded annual Capitalism and Morality conference in London and consultant to institutional investors.
    Here is a brief summary of the topics Jayant discusses in the interview:
    An overview of a recent speech he delivered in London entitled ‘Gold in India: Current Market Dynamics and Future Opportunities’ (Indian street prices of gold are 10% above prices elsewhere in the world, but they should be even higher – why is that so?) Recent political developments in India, where cows (which are considered sacred animals by many people) have become more popular than seems to be good for anyone walking on fewer than four legs. The increasingly dire situation in another submerging market, namely South Africa.* A developed market that seems set on becoming a submerging market, namely British Columbia in Canada. After an election in early May delivered a hung parliament, the province is threatened by a shift to the political left, with socialists and greens joining forces to form an authoritarian watermelon. A long list of outrageously absurd anti-free market policies are now hanging like the sword of Damocles over what was up until now the fastest growing region in the fastest growing G7 economy. Billions in planned investments in energy projects are inter alia at risk (those of the economically viable sort, not the cronyism and theft that is euphemistically referred to as ‘alternative’ energy).** Recent arbitrage opportunities developing in gold mining stocks. A reminder regarding this year’s Capitalism and Morality conference, which will host numerous very interesting speakers – there is still time to register.***

    This post was published at Acting-Man on June 14, 2017.

  • SWOT Analysis: Gold’s Strength Is Justified Says UBS

    The best performing precious metal for the week was palladium, up 5.10 percent. Grant Sporre, an analyst at Deutsche Bank, noted there is a genuine physical tightness in the market, but the spike had all the hallmarks of someone being caught short and being squeezed. Bullionvault’s Gold Investor Index, which measures the balance of client buyers against sellers, rose the most in two years reaching a high of 55.3 in May versus 52.1 in April, reports Bloomberg. In India, gold imports jumped fourfold in May to 126 metric tons from 31.5 metric tons in the same month last year. In a report by the World Gold Council, consumption in India could climb dramatically this year as a ‘simple’ nationwide Goods Services Tax will boost the economy, making the gold industry more transparent to benefit buyers, reports Bloomberg. Amid unease over a congressional hearing on possible links between Russia and the Trump campaign, holdings in SPDR Gold Shares (the world’s largest gold-backed ETF) climbed to the highest this year on the back of safe-haven demand, reports Bloomberg. In the two weeks through the end of May, hedge funds and other large speculators boosted their bullish bets on the precious metal by 37 percent, notes another Bloomberg article, the most since 2007 according to government data. Japanese investors sold a record amount of U. S. debt in April, reports Bloomberg. ‘Political turmoil in Washington and uncertainty about French elections pushed down Treasury yields, diminishing their attractiveness,’ the article continues. Japanese investors cut holdings of U. S. debt by $33.2 billion in April, the most in data going back to 2005, according to a Ministry of Finance balance-of-payments report.

    This post was published at GoldSeek on 12 June 2017.

  • Analysts Say India Tax Plan Will Boost Gold Demand in Long-Run

    Analysts at the World Gold Council say they believe a new tax plan set to go into effect in India will ultimately boost demand for gold in the world’s second-largest market for the yellow metal.
    On July 1, India’s current labyrinth of taxes will be replaced by a nationwide Goods & Services Tax (GST). The World Gold Council called it the ‘biggest fiscal reform since India’s liberalization in the early 1990s.’
    While gold consumers will face a slightly higher tax rate, and the industry will go through a period of adjustment, we see the net impact on the gold industry as being positive. The gold supply chain should become more transparent and efficient, and the tax reform can boost economic growth, which we see as supporting gold demand.’
    The government set the tax rate for gold under the GST at 3%, lower than the 5% expected. This has already sent a wave of optimism through the country’s gold and jewelry dealers.

    This post was published at Schiffgold on JUNE 12, 2017.

  • A2A with Alasdair Macleod of GoldMoney

    What a terrific and timely Q&A session we had Wednesday with Alasdair Macleod. Very informative and a must listen for everyone.
    Among the topics Alasdair addresses:
    The significance of the UK elections on Thursday. Next week’s FOMC meeting and possible Fed Funds rate hike. Physical demand for gold from China and India. The stability of the EU and the entire EU banking system. Will China soon spark a global, commodity-based inflation? Sharia-compliant gold and the new “Onegram” digital currency. And much, much more!

    This post was published at TF Metals Report on June 8, 2017.

  • How gold can rescue pensions

    The World Economic Forum, in conjunction with Mercers (the actuaries) recently estimated that the combined pension deficit currently stands at $66.9tr for eight countries, rising to $427.8tr in 2050. The eight countries are Australia, Canada, China, India, Japan, Netherlands, UK and US. Of the 2016 figure, $50.5tr is unfunded government and public employee pension promises.
    Yes, we are now talking in hundreds of trillions. Other welfare-providing states missing from the list have deficits that are additional to these estimates.i
    $66.9tr is roughly 1.5 times the GDP of the eight countries combined, and $427.8tr is nearly ten times. Furthermore, if we take out the non-productive government element, the figures relative to the private sector tax-paying base are closer to twice productive GDP today, and thirteen times greater in 2050. That 2050 deficit assumes a 5% compound annual growth rate. This is a linear projection, but the deterioration in finances for unfunded government pensions may turn out to be exponential, in line with the accelerated increase in the broad money quantity since the great financial crisis.
    The problem is mainly in the welfare states, so we know that the welfare states are in big trouble. Governments routinely offer inflation-protected pensions to state employees, funded out of current taxation. The planners in government treasury departments are coming alive to the scale of the problem, though the politicians would rather ignore it. Government finances are already being subverted by both unfunded pension obligations, and by additional rising healthcare costs for aging populations.
    Furthermore, people are living longer. Someone born in Japan ten years ago who retires at 60 can expect to live to 107, leaving the state picking up a forty-seven-year welfare and pensions bill. And it’s not much less expensive in other countries, with 50% of North American and European babies born in 2007 expected to live to 103.
    The global dependency ratio, those in work relative to those in retirement, is expected to deteriorate from 8:1 to 4:1 by 2050. When most people retire, they stop paying income tax and become a burden on the state welfare system. Therefore, retirement ages must rise. Not only must they rise, but they must rise by enough to pay for those who are otherwise fit but mentally incapacitated by dementia, Alzheimer’s and Parkinson’s, set to spend the last decades of their lives expensively kept.
    That is the background to a global problem. But we shall just say ‘poor taxpayers’, and move on. Instead, this article focuses not on the problems of funding state pensions (which is admittedly 75% of the problem), but is an overview on why the current low growth, low interest rate environment is so detrimental to private sector pensions.

    This post was published at GoldMoney on JUNE 08, 2017.

  • Chinese gold demand falling, not rising — Lawrie Williams

    One measure of Chinese gold demand which we follow is the level of gold withdrawals from the Shanghai Gold Exchange. With the publication today of the figure for May of 138.08 tonnes it appears that withdrawals to date this year are marginally down on those of a year ago – and substantially below the record seen in 2015. This is contrary to some other reports which suggest Chinese gold demand is stronger this year than last and may again be approaching record level.
    Even though SGE gold withdrawals may be down on 2016 and 2015, though, they do remain substantial by world levels, being equivalent to around 60% plus of all global new mined gold, and with Indian demand as represented by imports making a strong recovery this year (some reckon the annual Indian total may reach 1,000 tonnes again), these two nations alone will account for around 90% of all new mined gold – and gold flows into Asia as a whole, particularly if one adds in smuggled gold into India which some estimates put at over 200 tonnes, look like exceeding the global new mined total alone.
    With the major gold ETFs adding to their gold tonnage totals so far this year, and taking into account gold consumption throughout the rest of the world – notably in Europe – then we could be heading for a substantial undersupply of new physical gold which, logically, should drive the gold price higher. Scrap supply will probably make up much of this balance, but the major analytical consultancies see this as continuing to drop which should be a positive for gold’s fundamentals.

    This post was published at Sharps Pixley

  • Asian Metals Market Update: June-07-2017

    It seems all terror attacks in democratic nations happen before an election. I rarely find any terrorist attack after an election. I am confident that once UK and German elections are over, Europe will not see terror attacks for quite a long time. In Europe or the UK all terrorists were known to the law enforcement agencies and still they slept. It is very easy to radicalize anyone these days. Give a dissatisfied person/unemployed person a mobile phone with an internet connection and continuously send him links for radicalization. The person will get radicalized very quickly. Some get self-radicalized due to the content provided by facebook, twitter, whatsapp and other social networking platforms. This is a side effect of social networking. This is causing a big demographic change in the world. It is very easy to show all lies as truth in the virtual world. Islamic religious heads are doing the same along with NATO nations. This is also one key reason why gold has to rise in the long run and the US dollar/paper assets needs to be dumped.
    In India social networks (whatsapp, facebook etc) are changing the behavioral aspects of people, demand of any consumer product gets affected by social media. Social media is now a big cause for divorce in India and is growing. Productivity in offices gets reduced due to increased social media usage. However businesses are also lowering selling costs due to social media publicity. Demographic disruptions caused by social media will only increase the demand for physical gold in India.

    This post was published at GoldSeek on 7 June 2017.

  • India GST News Powers Gold Higher

    Gold is the world’s ultimate asset, and another spectacular week is underway for investors. While May was mostly sideways (and lower for many gold stocks), it’s starting to look like the month of June could be a serious ‘barnburner’. Please click here now. Double-click to enlarge this daily bars gold chart. Gold tends to stage a decent rally in the days following the release of the US jobs report. That’s in play now, as I suggested it would be, but the rally is also on ‘Indian demand steroids’. Please click here now. It’s unknown how big black market demand is, but the official demand alone came in at over 100 tons for May! This weekend’s government announcement of a 3% GST rate on gold sales has sent Indian jewellery stocks skyrocketing. The new GST effectively cuts the total tax rate in the state of Kerala, which I have dubbed ‘world gold demand headquarters’. In my professional opinion, the bear cycle in Indian demand is over. Once the Diwali festival buying season arrives, I’m predicting that imports could reach a new single month record high of 200 tons. Please click here now. Double-click to enlarge this big picture gold chart. With the bear cycle in Indian demand over, gold is likely to begin its rise out of the huge $1923 – $1045 consolidation pattern. Gold is essentially poised to play ‘catch-up’ with the skyrocketing price of anti-fiat currency bitcoin, and begin a steady rise to my targeted $2800 price level.

    This post was published at GoldSeek on 6 June 2017.

  • Gold Imports into China and India Surge

    Gold is flowing into India and China, as demand for the yellow metal in the world’s two largest markets continues to boom.
    Gold imports into India surged once again in May, building on strong March and April numbers. Increasing imports signal a continued rebound in demand for the precious metal in the world’s second-largest market after a tepid 2016.
    According to a Reuters report, gold imports quadrupled in May year-on-year, coming in at 103 tons. Analysts say they expect the rise in imports will likely help support global prices in the coming months.
    Jewelers accounted for the bulk of Indian gold imports last month, as they worked to replenish depleted inventories after a booming Akshay Tritiya festival in April. Gold sales increased more than 30% during the important Hindu holiday. All-told, Indians bought more than 23 tons of gold in a single day.

    This post was published at Schiffgold on JUNE 6, 2017.

  • India Announces Lower Than Expected Gold Tax Rate

    The Indian government set the tax rate for gold under the uniform goods and services tax lower than expected, sending a wave of optimism through the country’s gold and jewelry dealers. Analysts say the lower rate signals a potential recovery in demand for the yellow metal in the world’s second-largest market.
    According to a Bloomberg report, India fixed the duty at 3% over the weekend, lower than the 5% expected.
    The goods and services tax, to be implemented from July 1, will replace more than a dozen domestic levies including excise tax and state tariffs, drawing India for the first time into a common market.’
    The gold market has already showed signs of revival in India this spring.

    This post was published at Schiffgold on JUNE 5, 2017.

  • SWOT Analysis: Trump Probes Boost Gold’s Safe-Haven Demand

    The best performing precious metal for the week was palladium, up 6.17 percent. Consumer demand is rising for gasoline- versus diesel-engine powered vehicles, yet automobile sales have started to relax in recent months. According to Bloomberg, gold bulls outnumber gold bears this week as Trump probes are boosting safe-haven demand for the yellow metal. In fact, gold advanced to the highest level in nearly a month as Trump’s administration ‘grapples with revelations of mounting scrutiny into son-in-law Jared Kushner’s outreach to Russian officials,’ Bloomberg continues. In related news, Fed’s Brainard says that soft inflation data may warrant a rethink on interest rates. Inflation in the Euro-area slowed more than economists forecast. The Indian rupee posted its first monthly loss since November, reports Bloomberg. The positive side of this is the decline came amid increasing demand for dollars to pay for imports of items such as gold. The Perth Mint reported its gold coin and minted bar sales for the month of May, coming in at 29, 679 ounces. This is compared with April’s sales of 10,490 ounces. Data from the Commodity Futures Trading Commission shows that money managers boosted their long positions in U. S. gold futures by the most in almost a decade in the week ending May 23, reports Bloomberg. As you can see in the chart below, hedge funds are jumping back into the yellow metal.

    This post was published at GoldSeek on Monday, 5 June 2017.

  • Early Monsoon Season Will Boost Indian Gold Buying

    After the concerted western Central Bank effort, led by the BIS, to squelch Indian gold imports by eliminating the most commonly used currency bills failed, the fake news about Indian gold imports coming from the World Gold Council amplified. The WGC missed its Q1 2017 forecast for Indian gold imports by a country mile, as Indian gold imports doubled in Q1 to 253 tonnes. Please note that these numbers do not include the amount of gold smuggled into India, which has been estimated to be 200-300 tonnes annually.
    Now the World Gold Council is promoting the narrative that Indian gold imports will average only 90 tonnes per quarter the rest of the year because of a new General Sales Tax scheduled to be implemented on July 1st plus restrictions to be implemented on gold dore bar imports. However, this is again an ill-fated prediction, likely for the purpose of spreading anti-gold propaganda, which seems to be one of the World Gold Council’s general directives.
    First, in April and May, the premiums to world gold paid in India suggest that April/May imports already are well into triple-digits. And the WGC’s arguments are absurd, as expressed by John Brimelow in his Gold Jottings report:

    This post was published at Investment Research Dynamics on May 30, 2017.

  • Asian Metals Market Update: May-29-2017

    It is a big week for the US dollar as well as gold, silver and industrial metals. US May nonfarm payrolls will set the trend for the US dollar and also decide whether there will be more than one interest rate hike by the Federal Reserve this year. UK elections trends can result in safe haven demand for gold from the nation. India will decide the GST rate on gold sales and jewelry sales this week too.
    Geopolitics gets a new nation in the form of Philippines. State versus ISIS war in a small region of the nation will greater chances of the same spreading to more parts of Philippines. The current situation in Philippines is similar to Syria of 2012. Assad’s war started with a small bunch of so called terrorists which has gulped the whole nation. I will be looking for clues whether Philippines will be converted into a Syria as state heads of both these nations do not bow to the whims and fancies of NATO leaders. (NATO and the UN have a history of ousting pro people leaders like Gadaffi, Assad, Hosni Mubarak to name a few). I am very confident that both gold and bitcoins will benefit if the situation in the Philippines turn to worse.
    Philippines problems get aggravated by its neighbor, the most populous Islamic nation in the world ‘Indonesia’ and also Malaysia. Indonesia and Malaysia have a great percentage of population leaning towards the ISIS. The peaceful nation of Australia will also get affected if Philippines problems get aggravated. I am looking at the geopolitical developments in East Asia including the South China Sea.

    This post was published at GoldSeek on 29 May 2017.

  • Gold Risks ‘Excitement’ at 6-Year Downtrend as BTC Drops 10% from New Record, India Weighs GST Decision

    Gold prices jumped above $1265 per ounce in London trade Friday, gaining 0.9% for the week as world stock markets slipped despite another fresh overnight record-high in US equity indices.
    Major government bond prices rose, pushing interest rates down, and crude oil extended its slump from Tuesday’s 1-month highs despite the Opec producers’ cartel agreeing to curb output until 2018.
    Alongside gold prices, silver and platinum prices also traded at their highest Dollar level since late April, both gaining 2.3% for the week.
    Thanks to rising prices for so-called “junk” bonds, the dividend yield offered by European stock markets has now risen above the supposed “high yield” offered by bonds rated below investment grade, says a note from Bank of America Merrill-Lynch.
    More than doubling inside a month, the price of crypto-currency Bitcoin meantime fell sharply on Friday, retreating 10% from yesterday’s fresh all-time high of $2779.

    This post was published at FinancialSense on 05/26/2017.

  • India top importer of Swiss gold for fourth successive month — Lawrie Williams

    There’s probably no better indicator of the pick-up this year in Indian gold demand, after a dismal 2016, than the levels of Swiss exports to the world’s second most populous nation. In April, India was again the principal export destination for Swiss re-refined gold, as it has been every month so far this year. In the four months of the year so far India has imported no less than 167.2 tonnes of gold from the small European nation’s plethora of top-rated gold refiners. At this rate India will import around 500 tonnes of gold from Switzerland alone and, historically, it only sources a little under half its reported gold imports from Switzerland – in Q1 this year India reported total gold imports of 249 tonnes, of which 47.7%, or 119.2 tonnes came in from Switzerland.
    While as my colleague Julian Phillips notes in a recent post on http://www.lawrieongold.com the early year peak is perhaps already behind us, ahead of the monsoon season, but then gold demand tends to pick up again from September on as the harvest comes in, and ahead of the Dhanteras and Diwali festivals in October and then again with peak wedding season coming in in November and December. Indian Hindu weddings tend to take place on auspicious dates throughout the year apart from from mid-July to end-October – Chaturmas – a period deemed inauspicious for Hindu weddings.
    Julian Phillips thus puts estimated Indian gold demand this year as likely being around 1,000 tonnes plus, although this would likely be boosted by smuggled metal, while the World Gold Council (WGC) put India’s consumer demand last year at 675.5 tonnes. There may be an element of the jewellery sector restocking ahead of an expected Goods and Services Tax imposition due to come in in mid-year which could reduce second half imports, but regardless it looks as though Indian demand is due for a major pick-up this year which will enhance the yellow metal’s fundamentals.

    This post was published at Sharps Pixley

  • Asian Metals Market Update: May-24-2017

    The UK terror attack has failed to support gold and silver. There is some speculation that Indian demand for gold and silver is higher as jewelers expect higher tax rates on the GST front (Goods and Services Tax). GST rates on gold, silver and jewelry sales will be finalized on 3rd June. Gold and silver demand will fall after 3rd June as jewelers reduce buying. I do not expect the Modi government to lend support to the jewelers of India. The Modi led NDA government has increased taxes on every industry which is labour intensive. Jewelry making is still a labour intensive industry.
    The direction of the US dollar is the key for now.

    This post was published at GoldSeek on 24 May 2017.

  • Here Are The Three Choices Facing OPEC Next Week

    The last time OPEC (and Non-OPEC) member nations sat down to attempt a coordinated increase in oil prices by cutting production they succeeded… for about three months. Every since then, oil has been on a gradual declining path, boosted by a surge in US shale output and declining global demand, with WTI recently even sliding sliding below OPEC’s implicit price floor of $50/barrel. Which is why on May 25, after the failure of the first 6 month production cut, the same nations will try the same exercise, this time looking to cut output for 9 months, and hoping for a different outcome.
    At least that is the general expectation. Overnight, BofA’s Francisco Blanch has released a note previewing next week’s OPEC meeting titled “OPEC: extend and pretend“, and which boils down to the 3 choices faced by OPEC: maintain, curb, or hike output. For its part, BofA believes that OPEC will extend cuts and hope demand recovers. Additionally, Blanch also states that oOPEC’s goal for the oil market is to reach backwardation, not a specific price level and does not believe that OPEC will proceed with deeper cuts as this would likely mean ceding more market share to U. S. shale production.
    As Blanch explains in the summary, the global oil market deficit is smaller than the bank thought (see the dramatic, 500kb/d downward revision to global demand growth in chart 2 below) and as a result the cartel is struggling to bring down global stocks. This situation presents a major challenge for the cartel, as OPEC is targeting a shift in the term structure of global crude markets and not a specific oil price band according to Blanch: the idea is to penalize forward sellers and squeeze refiners. But soft demand in India and Mexico, a warm US winter, and an OPEC crude oil production overhang from 4Q16 have gotten in the way of a good plan.

    This post was published at Zero Hedge on May 19, 2017.