Wednesday, May 29, 2013
The Japanese Financial System Is Beginning To Spin Wildly Out Of Control
Michael Snyder
Economic Collapse
The financial system of the third largest economy on the planet is starting to come apart at the seams, and the ripple effects are going to be felt all over the globe. Nobody knew exactly when the Japanese financial system was going to begin to implode, but pretty much everyone knew that a day of reckoning for Japan was coming eventually. After all, the Japanese economy has been in a slump for over a decade, Japan has a debt to GDP ratio of well over 200 percent and they are spending about 50 percent of all tax revenue on debt service. In a desperate attempt to revitalize the economy and reduce the debt burden, the Bank of Japan decided a few months ago to start pumping massive amounts of money into the economy. At first, it seemed to be working. Economic activity perked up and the Japanese stock market went on a tremendous run. Unfortunately, there is also a very significant downside to pumping your economy full of money. Investors start demanding higher returns on their money and interest rates go up. But the Japanese government cannot afford higher interest rates. Without super low interest rates, Japanese government finances would totally collapse. In addition, higher interest rates in the private sector would make it much more difficult for the Japanese economy to expand. In essence, pretty much the last thing that Japan needs right now is significantly higher interest rates, but that is exactly what the policies of the Bank of Japan are going to produce.
There is a lot of fear in Japan right now. On Thursday, the Nikkei plunged 7.3 percent. That was the largest single day decline in more than two years. Then on Monday the index fell by another 3.2 percent.
And according to Business Insider, things are not looking good for Tuesday at this point…
The term “currency war” is something that you are going to hear a lot more over the next few years, and what you can see in the chart above is only the beginning.
What the Bank of Japan is doing right now is absolutely unprecedented. It has announced that it plans to inject the equivalent of approximately$1.4 trillion into the Japanese economy in less than two years.
As Kyle Bass recently discussed, that dwarfs the quantitative easingthat the Federal Reserve has been doing…
Because Japan has a debt to GDP ratio of more than 200 percent, the only way that it can avoid a total meltdown of government finances is to have super low interest rates. The video posted below does a great job of elaborating on this point…
It really is very simple. If interest rates rise substantially, Japan will be done.
Investor Kyle Bass is one of those that have been warning about this for a long time…
And what is happening right now in Japan should serve as a sober warning to the United States. Like Japan, the money printing that the Federal Reserve has been doing has caused economic activity to perk up a bit and it has sent the stock market on an unprecedented run.
Unfortunately, no bubble that the Federal Reserve has ever created has been able to last forever. At some point, we will pay a very great price for all of the debt that the U.S. government has been accumulating and all of the reckless money printing that the Fed has been engaged in.
So enjoy the calm before the storm while you still can.
It won’t last for long.
Economic Collapse
The financial system of the third largest economy on the planet is starting to come apart at the seams, and the ripple effects are going to be felt all over the globe. Nobody knew exactly when the Japanese financial system was going to begin to implode, but pretty much everyone knew that a day of reckoning for Japan was coming eventually. After all, the Japanese economy has been in a slump for over a decade, Japan has a debt to GDP ratio of well over 200 percent and they are spending about 50 percent of all tax revenue on debt service. In a desperate attempt to revitalize the economy and reduce the debt burden, the Bank of Japan decided a few months ago to start pumping massive amounts of money into the economy. At first, it seemed to be working. Economic activity perked up and the Japanese stock market went on a tremendous run. Unfortunately, there is also a very significant downside to pumping your economy full of money. Investors start demanding higher returns on their money and interest rates go up. But the Japanese government cannot afford higher interest rates. Without super low interest rates, Japanese government finances would totally collapse. In addition, higher interest rates in the private sector would make it much more difficult for the Japanese economy to expand. In essence, pretty much the last thing that Japan needs right now is significantly higher interest rates, but that is exactly what the policies of the Bank of Japan are going to produce.
There is a lot of fear in Japan right now. On Thursday, the Nikkei plunged 7.3 percent. That was the largest single day decline in more than two years. Then on Monday the index fell by another 3.2 percent.
And according to Business Insider, things are not looking good for Tuesday at this point…
In post-close futures trading, the Nikkei has dropped by another couple hundred points, and has dropped below 14,000.Are we witnessing the beginning of a colossal financial meltdown by the third largest economy on the planet? The Bank of Japan is starting to lose control, and if Japan goes down hard the crisis could spread to Europe and North America very rapidly. The following is from a recent article by Graham Summers…
As Japan has indicated, when bonds start to plunge, it’s not good for stocks. Today the Japanese Bond market fell and the Nikkei plunged 7%. The entire market down 7%… despite the Bank of Japan funneling $19 billion into it to hold things together.And all of this money printing is absolutely crushing the Japanese yen. Since the start of 2013, the yen has declined 16 percent against the U.S. dollar, even though the U.S. dollar is also being rapidly debased. Just check out this chart of the yen vs. the U.S. dollar. It is absolutely stunning…
This is what it looks like when a Central Bank begins to lose control. And what’s happening in Japan today will be coming to the US in the not so distant future.
If you think the Fed is not terrified of this, think again. The Fed has pumped over $1 trillion into foreign banks, hoping to stop the mess from getting to the US. As Japan is showing us, the Fed will fail.
Investors, take note… the financial system is sending us major warnings…
If you are not already preparing for a potential market collapse, now is the time to be doing so.
The term “currency war” is something that you are going to hear a lot more over the next few years, and what you can see in the chart above is only the beginning.
What the Bank of Japan is doing right now is absolutely unprecedented. It has announced that it plans to inject the equivalent of approximately$1.4 trillion into the Japanese economy in less than two years.
As Kyle Bass recently discussed, that dwarfs the quantitative easingthat the Federal Reserve has been doing…
“What they’re doing represents 70% of what the Fed is doing here with an economy 1/3 the size of ours”The big problem for Japan will come when government bond yields really start to rise. The yield on 10 year government bonds has been creeping up over the past few months, and if they hit the 1.0% mark that will set off some major red flags.
Because Japan has a debt to GDP ratio of more than 200 percent, the only way that it can avoid a total meltdown of government finances is to have super low interest rates. The video posted below does a great job of elaborating on this point…
It really is very simple. If interest rates rise substantially, Japan will be done.
Investor Kyle Bass is one of those that have been warning about this for a long time…
There’s a fatalism, he says, in everyone he talks to in Japan. Their thinking is changing, and the way they talk to him about debt is changing. They already spend 50% of tax revenue on debt service.The financial problems in Cyprus and Greece are just tiny blips compared to what a major financial crisis in Japan would potentially be like. The Japanese economy is larger than the economies of Germany and Italy combined. If the house of cards in Japan comes tumbling down, trillions of dollars of investments all over the globe are going to be affected.
“If rates go up, it’s game over.”
And what is happening right now in Japan should serve as a sober warning to the United States. Like Japan, the money printing that the Federal Reserve has been doing has caused economic activity to perk up a bit and it has sent the stock market on an unprecedented run.
Unfortunately, no bubble that the Federal Reserve has ever created has been able to last forever. At some point, we will pay a very great price for all of the debt that the U.S. government has been accumulating and all of the reckless money printing that the Fed has been engaged in.
So enjoy the calm before the storm while you still can.
It won’t last for long.
Russian gas pipeline could doom Europe’s Nabucco plan
Source: Reuters
* Europe, U.S. support for Nabucco weakened
* Azeri consortium expected to pick winner in June
* Gas due to flow to European Union from 2019
By Georgina Prodhan and Barbara Lewis
VIENNA/BRUSSELS, May 28 (Reuters) – Europe’s grand plan for a gas pipeline from the Caspian Sea that would make its eastern states less reliant on Russia may have been fatally undermined by Russia’s even bigger project.
As Azerbaijan nears a decision on which pipeline to choose for its future exports, the Nabucco plan that was long the European Union favourite could lose out to the more modest Trans Adriatic Pipeline (TAP) across Greece to southern Italy.
In a complex equation based on politics as much as economics, TAP is in the ascendancy over the Nabucco pipeline to Austria in the face of Russia’s $39 billion South Stream plan.
“The question is: ‘Is Nabucco viable if South Stream is built?’” said Andrew Neff, Moscow-based principal energy analyst with research firm IHS.
The decision between TAP and Nabucco is expected in June from partners in the Shah Deniz consortium, led by gas field operator BP and Azeri state energy company Socar.
The European Union won’t have a direct say in the choice, but its recent switch to “project neutrality” from support for Nabucco could make a big difference. It now says it would be happy with either pipeline or even both.
“There has been a dramatic shift,” TAP’s External Affairs Director Michael Hoffmann told Reuters.
Nabucco spokesman Christian Dolezal, however, said his project retained strong political support.
OPERA
Europe’s original plan was one 3,900 km (2,400 mile) pipeline all the way from Azerbaijan, across Turkey and up through the Balkans. It was named Nabucco after the epic Verdi opera, with its rousing chorus, that the founding parties had listened to at the Vienna opera house in 2002.
Although the plan, led by Austria’s OMV, was scaled back to a 1,300 km (800 mile) version linked to a Turkish pipe, it had kept the favour of both Brussels and Washington.
That was not least because ‘Nabucco West’ would cross former eastern bloc countries that depend the most on Russia for energy – even though initial Azeri gas supplies will account for a mere 2 percent of EU needs.
The TAP pipeline is only 800 km (500 miles), including a stretch under the sea to southern Italy. Its shareholders are led by Swiss AXPO and Statoil, which has a stake in the Azeri gas fields.
The business case for the two appears relatively balanced.
Nabucco would be estimated to cost less than $8 billion with one Azeri expert reckoning TAP would be $500 million cheaper, but Nabucco might bring access to more markets.
“Both have advantages and disadvantages,” said Gulmira Rzayeva, a leading research fellow at the Center for Strategic Studies under the President of the Republic of Azerbaijan.
All of which makes the politics even more important.
EXPEDIENT
Choosing TAP, which does not cut through territory that Russia traditionally dominated, could be politically expedient for Azerbaijan, which is broadly aligned with the West but has no interest in conflict with its former Soviet overlord.
Russia began building South Stream in December and hopes to deliver gas to Europe well before 2019, when the Azeri gas is due to start flowing to the European Union..
The Gazprom-led 2,500 km (1,500 mile) South Stream will cross the Black Sea and then closely follow the line of Nabucco West. Plans for a southern route that could have competed with TAP were scrapped, another boost for Nabucco’s rival.
Southern European states see benefits for themselves too.
Italy, which relies for gas on politically unstable North Africa as well as Russia, is keen to diversify supply.
Struggling to recover from its debt crisis, Greece would welcome the additional revenue from the pipeline. Influential Germany would be happy with anything that strengthens Greek finances and reduces potential future bailout costs.
The Trans Adriatic Pipeline would have the side benefit of forcing greater cooperation between old rivals Greece and Turkey, EU diplomats said.
Bulgaria and Romania, the poorest European Countries, would appreciate the infrastructure investments if Nabucco were built.
But their economies do not face the immediate pain that Greece’s does – and a South Stream pipeline through Bulgaria, Serbia, Hungary and Slovenia would also bring economic benefits even though it would not break Russia’s dominance.
Washington is less concerned about the pipeline supply route to NATO allies than it was given the change in the global energy picture as a result of the U.S.-led shale gas boom and the increasing importance of liquefied natural gas, which can be shipped by sea.
In fact, the emergence of those alternative gas supplies has raised debate about whether long pipelines which tie end users into relatively expensive contracts can be justified by the economics alone.
BREAKING: U.S. weapons system designs ‘compromised’ by Chinese cyberspies
Confidential report lists U.S. weapons system designs compromised by Chinese cyberspies
Designs for many of the nation’s most sensitive advanced weapons systems have been compromised by Chinese hackers, according to a report prepared for the Pentagon and to officials from government and the defense industry.
Among more than two dozen major weapons systems whose designs were breached were programs critical to U.S. missile defenses and combat aircraft and ships, according to a previously undisclosed section of a confidential report prepared for Pentagon leaders by the Defense Science Board.
Experts warn that the electronic intrusions gave China access to advanced technology that could accelerate the development of its weapons systems and weaken the U.S. military advantage in a future conflict.
http://www.washingtonpost.com/world/national-security/confidential-report-lists-us-weapons-system-designs-compromised-by-chinese-cyberspies/2013/05/27/a42c3e1c-c2dd-11e2-8c3b-0b5e9247e8ca_story.html?hpid=z1
REPORT: PLANS FOR AUSTRALIA SPY HQ HACKED BY CHINA
http://hosted.ap.org/dynamic/stories/A/AS_AUSTRALIA_CHINESE_HACKERS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2013-05-28-05-45-23
Designs for many of the nation’s most sensitive advanced weapons systems have been compromised by Chinese hackers, according to a report prepared for the Pentagon and to officials from government and the defense industry.
Among more than two dozen major weapons systems whose designs were breached were programs critical to U.S. missile defenses and combat aircraft and ships, according to a previously undisclosed section of a confidential report prepared for Pentagon leaders by the Defense Science Board.
Experts warn that the electronic intrusions gave China access to advanced technology that could accelerate the development of its weapons systems and weaken the U.S. military advantage in a future conflict.
http://www.washingtonpost.com/world/national-security/confidential-report-lists-us-weapons-system-designs-compromised-by-chinese-cyberspies/2013/05/27/a42c3e1c-c2dd-11e2-8c3b-0b5e9247e8ca_story.html?hpid=z1
REPORT: PLANS FOR AUSTRALIA SPY HQ HACKED BY CHINA
http://hosted.ap.org/dynamic/stories/A/AS_AUSTRALIA_CHINESE_HACKERS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2013-05-28-05-45-23
Central Banks Show “Faith in Gold” as Western Investment “Hits Obstacle”, Indian Policies Risk Surge in Smuggling
London Gold Market Report
from Adrian Ash, BullionVault
Tues 28 May, 08:05 EST
Central Banks Show “Faith in Gold” as Western Investment “Hits Obstacle”, Indian Policies Risk Surge in Smuggling
ALTHOUGH silver rallied, the price of gold held onto an earlier drop Tuesday morning in London, retreating from last week’s closing levels as UK and US traders returned from national holidays.
Gold edged down to $1380 per ounce, half-a-percent below Friday, even as the US Dollar slipped on the currency market.
Silver recovered to $22.33 per ounce, just 10¢ shy of last week’s finish.
World stock markets rose sharply meantime, adding 1.7% to London’s FTSE100. Major government bonds fell, nudging interest rates higher.
“The business cycle puts gold in an uncomfortable position,” reckons Bank of America analyst Michael Widmer in London.
“Higher growth, rise in nominal [bond] yields and subdued inflationary pressure have all limited investor buying.”
UBS precious metals team agrees, saying that 2013′s “strong rally in equities…has presented an obstacle” for the gold price. Because the metal now faces competition for investment capital.
However, “some moderation of the trend of rotating out of gold in favor of equities may be in store,” the Swiss bank’s bullion analysts said in a note Friday. Because “much of this [rotation] has already been done.”
One major route to gold-price exposure, exchange-traded gold trusts have lost 443 tonnes of gold so far in 2013 – a drop of nearly one fifth – says a note from Barclays Capital. But they still hold 109 tonnes of “cash negative” positions, it warns.
With those investors looking to cut their losses on gold, “prices continue to be exposed to downside risk in the near term,” says BarCap. “But once this metal is flushed out, we believe prices are more likely to stabilize.”
“Some people still have faith in gold,” says Yvonne Wang at metals consultancy Beijing Antaike, speaking to Bloomberg on Monday about the latest central-bank gold reserves data from the International Monetary Fund.
As a group, central banks added more than 30 tonnes of gold to their foreign currency reserves in April, the IMF says.
More than half that sum came from commercial banks in Turkey putting physical gold on deposit at the central bank in Ankara.
Russia led actual purchases, growing its central bank gold bullion holdings by 0.8% to 989 tonnes.
“I think [this] news will help to steady the gold price decline,” says Wang.
End of business Tuesday will mark expiry and settlement for the June contract in US gold futures.
The heaviest interest is concentrated at $1400 per ounce, so “it is no surprise to see the market within touching distance of that level,” says David Govett at precious metals broker Marex.
“If we rally at all today, expect some initial selling ahead of this, but if we manage to break through, then some short covering” – forcing a spike in prices as bearish traders rush to close their positions.
Betting against gold prices by hedge funds and other speculators through US futures ended last Tuesday equal to nearly 340 tonnes – the highest level in at least 20 years – according to data released Friday.
Subtracting those bearish bets from the bullish contracts held by speculative traders, the group last week cut their “net long” position on gold for the 3rd week running.
That’s “the longest streak of liquidations we’ve seen since October last year,” says Standard Bank’s analysis.
Meantime in Asia, “We are not seeing any signs of slowing down,” said one Singapore dealer to Reuters this morning.
“People are still thinking it is a good price to go in at.”
After India tightened controls on gold imports at the start of this month, gold dealers in Hyderabad have now “run out” of gold coins, according to the Deccan Chronicle.
India’s government yesterday moved to try and curb interest in gold still further, blocking owners of exchange-traded gold funds (ETFs) from raising loans against those shares through Indian banks.
Neighboring Pakistan, in contrast, may cut its import tax on gold according to theBusiness Recorder. Because the 1% duty imposed six years ago has now been blamed for increased smuggling and lower bullion-import revenues.
Gold smuggling to India could rise by 40% to 140 tonnes in 2013 reckons the Thomson Reuters GFMS consultancy. That would account for nearly one ounce in every six sold to consumers in the world’s heaviest gold buying nation.
Adrian Ash
from Adrian Ash, BullionVault
Tues 28 May, 08:05 EST
Central Banks Show “Faith in Gold” as Western Investment “Hits Obstacle”, Indian Policies Risk Surge in Smuggling
ALTHOUGH silver rallied, the price of gold held onto an earlier drop Tuesday morning in London, retreating from last week’s closing levels as UK and US traders returned from national holidays.
Gold edged down to $1380 per ounce, half-a-percent below Friday, even as the US Dollar slipped on the currency market.
Silver recovered to $22.33 per ounce, just 10¢ shy of last week’s finish.
World stock markets rose sharply meantime, adding 1.7% to London’s FTSE100. Major government bonds fell, nudging interest rates higher.
“The business cycle puts gold in an uncomfortable position,” reckons Bank of America analyst Michael Widmer in London.
“Higher growth, rise in nominal [bond] yields and subdued inflationary pressure have all limited investor buying.”
UBS precious metals team agrees, saying that 2013′s “strong rally in equities…has presented an obstacle” for the gold price. Because the metal now faces competition for investment capital.
However, “some moderation of the trend of rotating out of gold in favor of equities may be in store,” the Swiss bank’s bullion analysts said in a note Friday. Because “much of this [rotation] has already been done.”
One major route to gold-price exposure, exchange-traded gold trusts have lost 443 tonnes of gold so far in 2013 – a drop of nearly one fifth – says a note from Barclays Capital. But they still hold 109 tonnes of “cash negative” positions, it warns.
With those investors looking to cut their losses on gold, “prices continue to be exposed to downside risk in the near term,” says BarCap. “But once this metal is flushed out, we believe prices are more likely to stabilize.”
“Some people still have faith in gold,” says Yvonne Wang at metals consultancy Beijing Antaike, speaking to Bloomberg on Monday about the latest central-bank gold reserves data from the International Monetary Fund.
As a group, central banks added more than 30 tonnes of gold to their foreign currency reserves in April, the IMF says.
More than half that sum came from commercial banks in Turkey putting physical gold on deposit at the central bank in Ankara.
Russia led actual purchases, growing its central bank gold bullion holdings by 0.8% to 989 tonnes.
“I think [this] news will help to steady the gold price decline,” says Wang.
End of business Tuesday will mark expiry and settlement for the June contract in US gold futures.
The heaviest interest is concentrated at $1400 per ounce, so “it is no surprise to see the market within touching distance of that level,” says David Govett at precious metals broker Marex.
“If we rally at all today, expect some initial selling ahead of this, but if we manage to break through, then some short covering” – forcing a spike in prices as bearish traders rush to close their positions.
Betting against gold prices by hedge funds and other speculators through US futures ended last Tuesday equal to nearly 340 tonnes – the highest level in at least 20 years – according to data released Friday.
Subtracting those bearish bets from the bullish contracts held by speculative traders, the group last week cut their “net long” position on gold for the 3rd week running.
That’s “the longest streak of liquidations we’ve seen since October last year,” says Standard Bank’s analysis.
Meantime in Asia, “We are not seeing any signs of slowing down,” said one Singapore dealer to Reuters this morning.
“People are still thinking it is a good price to go in at.”
After India tightened controls on gold imports at the start of this month, gold dealers in Hyderabad have now “run out” of gold coins, according to the Deccan Chronicle.
India’s government yesterday moved to try and curb interest in gold still further, blocking owners of exchange-traded gold funds (ETFs) from raising loans against those shares through Indian banks.
Neighboring Pakistan, in contrast, may cut its import tax on gold according to theBusiness Recorder. Because the 1% duty imposed six years ago has now been blamed for increased smuggling and lower bullion-import revenues.
Gold smuggling to India could rise by 40% to 140 tonnes in 2013 reckons the Thomson Reuters GFMS consultancy. That would account for nearly one ounce in every six sold to consumers in the world’s heaviest gold buying nation.
Adrian Ash
The Fiat End Game: Preparing For A Way Forward
http://www.soundmoneycampaign.com The Fiat End Game: Preparing For A Way Forward, is a our latest micro-documentary focused on solutions to our current economic problems. Our current fiat currency standard is terminal, nations around the world are dropping the U.S. dollar as a medium of exchange, central banks are buying gold, and Americans are seeing price inflation during an economic downturn. In order to avoid a systemic financial crisis here in the U.S., we need to focus on solutions. Please watch this important video and join us in a new financial awakening happening right now all across America.
Tuesday, May 28, 2013
Central bank support pledges boost shares, dollar
By Richard Hubbard
LONDON (Reuters) - Investors seized on clear signs of
policy support from Japanese and European central banks on Tuesday to
drive world shares higher, denting appetite for safe-haven German bonds.The better sentiment also put Wall Street on course for a higher open when trading resumes after Monday's holidays in the major centers. All three major stock indexes ended last week in negative territory for the first time since mid-April. (.N)
Heightened expectations the U.S. central bank could soon taper its stimulus program unleashed turbulence across the markets last week, leaving it to central banks in Japan and Europe to reassure investors their liquidity taps remain open.
"I expect the major markets to test resistance levels of last week as investors are still seeking higher highs and new record levels in the near term, whilst the central banks are continuing their quantitative easing operations," said Tom Robertson, senior trader at Accendo Markets.
Equity markets around the world have traded at their highest levels in years encouraged by cheap funding from the Fed and other central banks. But comments last week by Fed chairman Ben Bernanke suggesting a U.S. recovery could bring a shift in policy have made investors question prospects for further gains.
"We have had a significant move higher and now it's time for taking stock and deciding whether we continue to go higher or we are due a correction," Michael Hewson, Senior Market Analyst at CMC Markets said.
The question is being asked most about the Japanese market, where the Nikkei stock index had reached a 5-1/2-year high before dropping 7.3 percent last Thursday - its largest one-day loss since the March 2011 earthquake and tsunami. (.T)
The Nikkei (.N225) steadied on Tuesday, ending 1.2 percent higher after long-serving board member Ryuzo Miyao said the Bank of Japan would fine-tune market operations to ensure its unprecedented easing campaign is not derailed.
Central bank officials lifted sentiment in Europe, where the broad FTSE Eurofirst 300 index (.FTEU3) rose over 1.3 percent by mid-morning, adding to Monday's 0.3 percent rise. European Central Bank Executive Board member Peter Praet said the ECB could still cut interest rates further to stimulate the economy if needed.
Tuesday's rebound took Germany's DAX (.GDAXI) up 1.1 percent to near recent record highs. In London, the FTSE 100 index (.FTSE) was up 1.67 percent, led by banking stocks.
MSCI's world equity index <.miwd00000pus> had risen 0.3 percent by mid-morning, reversing four days of losses.
SAFETY ABANDONED
Assets seen as safe havens fell, leaving the dollar up 0.7 percent against the Swiss franc at 0.9697 francs. "The yen and Swiss franc have dropped noticeably this morning, essentially because risk assets seem to be stabilising," said Societe Generale currency strategist Alvin Tan.
The euro was down 0.2 percent at $1.2910 against the dollar, trading well within its recent range of $1.28-1.32.
Investors also deserted German government bonds although the talk of an ECB rate cut lent support. The yield on the 10-year bond was down 1 basis point at 1.43 percent.
Commodity markets remain pressured by an uncertain demand outlook after U.S. and Chinese data last week.
The rising dollar also makes some dollar-based commodities more expensive for non-dollar holders. Spot gold was down 1 percent to $1,380.50 an ounce.
However the better
tone on equity markets and signs of rising Middle East tension support
oil. U.S. crude futures gained 0.7 percent to $94.78 a barrel and Brent
rose 1.4 percent to $104 a barrel.
(Additional reporting by Atul Prakash and Anooja Debnath. Editing by Catherine Evans)
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