Yesterday’s AM fix was USD 1,641.75, EUR 1,225.28 and GBP 1,053.15 per ounce.
Silver is trading at $31.05/oz, €23.11/oz and £20.02/oz. Platinum is trading at $1,724.50/oz, palladium at $772.00/oz and rhodium at $1,200/oz.
Cross Currency and Precious Metal Table – (Bloomberg)
Gold rose $1.80 or 0.11% yesterday on closing at $1,651.50/oz. Silver slipped to $30.57 in London, but it then bounced higher and finished with a gain of 0.42%.
Gold and silver are marginally lower today while platinum and palladium have eked out further gains after the 1% gains seen yesterday. The Wall Street Journal reports that there was gold buying in Asia overnight with “bargain hunting helping to lift prices”.
Group of Seven policy makers roiled the currency and commodity markets they sought to calm amid conflicting messages on how much of an economic threat is posed by currency wars.
The G7 sought to focus attention on the narrow issue of recent yen weakness rather than the more substantial issue of global currency wars in the form of QE ‘to infinity’, competitive currency devaluations, currency pegs and currency debasement.
As long as the G7 continue to obfuscate and fail to address the real risk from actual currency wars and an escalation of currency and gold wars then financial and monetary tensions are set to deepen which will support many non paper assets and the precious metals.
Russia’s jump in gold mining output may see it pass the U.S. as the 3rd largest gold miner by 2015, said Sergei Kashuba, head of the Russian Gold Industrialists' Union, said on Tuesday.
Platinum and palladium surged Tuesday on renewed concerns that supplies of the platinum group metals will shrink.
Platinum Spot $/oz, 16FEB03-13FEB13 – (Bloomberg)
Zimbabwe's government has given platinum producers two years to begin refining the precious metals in Zimbabwe.
This means that production of platinum will drop, because mining companies are now expected to build refineries – something which they may not do, due to the real risk of confiscation and nationalisation of assets.
Palladium Spot $/oz, 29OCT95-13FEB13 – (Bloomberg)
Both metals climbed more than 1% yesterday with platinum for April delivery rising $21.10 to settle at $1,717.2/oz. Palladium for March delivery rose $12.80 to $771.40/oz.
"The worry is that it's going to restrict production," said James Steel, chief commodities analyst at HSBC in New York. "That was the prime motivator for the price movement today."
Platinum-group metals are widely used to make catalytic converters that filter car exhausts, in jewellery where increasing demand has been seen in Asia and in many military applications.
The majority of the world's platinum reserves are found in just one country, South Africa. But neighboring Zimbabwe also sits on large reserves.
Similar resource nationalism in other countries in Africa, South America and Russia could lead to serious supply issues which mean that the fundamentals of the platinum group metals remain sound.
Both remain well below their record nominal highs and way below their inflation adjusted highs.
The PGM metals are more volatile than gold and therefore merit a lesser allocation of one’s wealth but platinum and palladium coins and bars remain a prudent diversification for anyone wishing to preserve and grow wealth in the coming years.
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