Friday, November 15, 2013

Yellen About the Yellow Metal

Gold is down a bit this morning. I have a new issue of Gold & Resource Trader going out to subscribers TODAY.

News links of interest...

In remarks released on Wednesday afternoon, Federal Reserve Chair nominee Janet Yellen made four critical points
  •  She believes the benefits of the QE program still outweigh the cost.
  • She sees “meaningful progress” in the labor market but wants to see signs that the economy is growing fast enough to sustain them.
  • There is no set time for removing the QE program. The Fed is assessing its progress at every meeting.
  • The program can’t go on forever.

This was pretty “dovish,” meaning that those hoping for an early end to the QE program were disappointed. And that sent the US dollar lower and gold higher on Thursday.

Yellen's take on gold led to this notable Tweet from Merk Investments head Axel Merk: "Yellen may not understand gold, but gold understands Yellen. Gold up today."

Here is Barron's take on Gold and Yellen

WGC: China Already Tops Record For Full-Year Gold Demand
For the year through September, mainland Chinese gold demand was 797.8 metric tons, reported Marcus Grubb, managing director of investment for the World Gold Council. Demand for full-year 2012 was around 776 tons. India’s official demand was listed at 715.7 tons through September, compared to around 602 for the first nine months of 2012, Grubb said.

In fact, China has become the world's top gold buyer.

Central banks continue to be strong buyers of gold, albeit at a slower rate. Q3 2013 was the 11th consecutive quarter of net purchases of gold. And here is a chart of Russia's gold reserves ...


Gold Seen Flowing East as Refiners Recasting Bars for Asia
Asian bullion demand will keep expanding as elevated inflation spurs purchases, HSBC Holdings Plc economists including Frederic Neumann wrote last month in a report that said the region is “going for gold.” A vault that can hold 2,000 tons was opened in Shanghai by Malca-Amit Global Ltd. this month to target increased demand for storage space.

India Paying an Equivalent $1,565 Per Ounce For Physical Gold Bullion

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