Text Version
RSS Feeds
Home Forum Photos Features Newsletter Archive Employment
About US Help Site Map
SEARCH   About US FAQ Site Map Site News
  -Text Version
  -RSS Feeds
  -News Archive
  -Give us feedback
  -Voices of Readers
  -Online community
  -China Biz info
  What's new
Gold loses its luster
+ -
09:30, September 05, 2008

 Comment  Tell A Friend
 Print Format  Save Article
Despite occasional spikes, Shanghai gold prices have mirrored the global downturn, as the strengthening US dollar and declining oil prices combine to take the sheen off the yellow metal.

Although the price of the most actively traded gold futures contract for December delivery rose a slight 0.61 percent to 180.30 yuan per gram yesterday on the Shanghai Futures Exchange, the contract has dropped an aggregate 14.9 percent since mid July.

Gold futures prices on the New York Mercantile Exchange have dropped a total 16.7 percent in the past six weeks. The price of the most actively traded gold futures for December delivery on the NYME climbed 1.25 percent to $816.1 per ounce during yesterday's trade on the Asian electronic board.

The "dollar strength" has come in large part from weakness in other major currencies - in particular, the euro, according to a JPMorgan report on gold and precious metals.

The exchange rate of the euro against the US dollar has dropped a total of 8.6 percent since mid July.

Traders and analysts said rising investor worries of a possible interest rate cut to be announced by the European Central Bank at its regular meeting last night (local time) forced investors to shift from euro-denominated to US dollar-denominated assets, which further pushed up the US dollar value against the euro.

Analysts said the downward spiral of gold prices would last for some time, because the US dollar is expected to appreciate and oil prices will drop further on concern about a slowing world economy.

Oil prices on the global market have dropped sharply over the past two months, with the most actively traded oil futures contract for delivery in October on the NYME plunging an aggregate 25.6 percent to $110.15 per barrel from the peak of $148.13 on July 11.

But some analysts said gold prices would recover slightly in the coming months on falling world gold mining supplies and seasonal demand from India.

"In this environment, the established dollar/gold relationship cannot be relied upon ... the falling mine supply and the reduced willingness of the central banks to sell gold should be supportive of the metal," John Bridges, CFA at JPMorgan Securities Inc, said.

Source: China Daily

  Your Message:   Most Commented:
To foreign friends: Experience the real China
Tiny singer wins heart of nation
French president: Beijing Olympics to achieve success of world renown 
Russia warns against NATO membership for Georgia 
Why some Western media scared of reportage on true China

|About Peopledaily.com.cn | Advertise on site | Contact us | Site map | Job offer|
Copyright by People's Daily Online, All Rights Reserved