Analysis: Gold is back on its feet

February 22, 2009

Commodity Online
The year 2008 has been ‘A year of wrath’ with the fourth quarter of 2008 breaking all records for all the wrong reasons. United States is sinking under its own burden of serious and widespread job losses, falling retail sales and plummeting stocks.

The only thing that seems to be growing across the globe is fear and restlessness that this crisis is far from over and no one seems to know where the bottom is. January did not bring anything promising to lift the global economic gloom and Obama’s charm seemed to have faded quite soon.

Buy Gold Online! Get Free Gold Coins!

And if this was not enough the IMF added to the dark outlook by forecasting at the end of the month that global growth in 2009 will be just 0.5 percent, the weakest since 1945, against its estimate in November 2008 of 2.2 percent.

Gold is at its very best in such trying times and ought to perform better than it has in these difficult markets; at least that is what most hope. Again, the strong rallying dollar has kept the metal at bay and there are no fundamentals to back the greenback except this feeling of ‘déjà vu’ when we once again explain the dollar’s strength with our very own ‘Better amongst the worst
currencies’ theory.

Gold was trading range bound in the beginning of January with the much unpredictable euro/dollar exchange until the dollar rallied in mid month only to cut the yellow metal’s climb. The slowdown of Gold sales by Central Banks ought to give support to Gold prices and so will the economic crisis, that is, if it further deepens.

January Gold prices averaged at $858.6/oz slightly higher than December prices averaging at $819.55/oz. The second half of the month saw Gold flexing its muscles as it broke the $900 levels to reach $920/oz. Despite a fairly strong dollar through the month of January, Gold rallied on the back of investor confidence and buying. This leap looks hopeful and seems more like an attempt to break the long continued pattern that Gold prices have seen since March last year.

Most interestingly, this rise in Gold has come alongside the dollar rally which only suggests that Gold is back on its feet.

To buy Hallmarked 999.9 Pure Swiss Gold Bars, Gold Bullion, Gold Ingots & 916 Gold Coins in Singapore or convert your 916 Physical Gold to physical 999.9 Pure Swiss Gold Bars, Click on Buy Gold to find out more. You may Sell Gold to us too.

[ Back To Home ]

[ Site Map ] [ Terms & Conditions ] [ Disclaimer ] [ Contact ] [ How To Link To Us ] [ Gold Directory ]

Buy Gold & Sell Gold - Singapore Gold Bullion Dealer