Gold is more or less flat this morning trading at 1245.35 in the Asian session. Gold has seen small gains and losses this week but remains in a tight range between the 1240-1250 price level as traders look for higher profits in equities. Wall Street continues to break records as speculators look for higher yielding assets as the year draws to an end. The pact sealed between Western Allies and Iran over the weekend, may not last long, it may not be good or practical but in the near term has helped drop global tensions to their lowest levels in years allowing traders a comfort zone. Gold is a safety net against uncertainty and inflation, neither of which are on the rise as trader sell of gold. Gold lost 26 percent this year, tumbling to a 34-month low of $1,180.50 in June, amid speculation that the Fed will begin trimming its $85 billion-a-month of asset purchases that helped bullion cap a 12th year of gains in 2012. Assets in the SPDR Gold Trust, the biggest exchange-traded product backed by bullion, were unchanged at 848.91 metric tons yesterday, the least since January 2009, after a six-day contraction that was the longest slump since August. As we approach the FOMC meeting on December 18th traders will once again focus on the tapering issue, but with Janet Yellen taking the reigns over in January, traders are booking odds that nothing will happen in December now that Yellen is pushing to tie stimulus not only to unemployment and inflation but to growth. The US economy is chugging along nicely, but it is sporadic and hectic.
Traders will be closely eyeing today’s durable goods data along with the University of Michigan Consumer Confidence report which might cause some market volatility but is unlikely to have an effect on precious metals. Silver, which dropped 1.9 percent yesterday, rose as much as 0.3 percent to $19.9224 an ounce before trading at $19.8716. Metal in ETPs dropped to 19,762.4 tons yesterday, the least since Aug. 13. Platinum traded at $1,374.90 an ounce from $1,375.50 yesterday, when prices dropped to a six-week low of $1,369.29. Palladium was little changed at $717.50 an ounce.
Copper gained 4 pips this morning as the US dollar eased a bit. Copper is trading at 3.215 well above last week’s price range with the US dollar at 80.60 down 4 pips today. Copper swung between gains and losses as investors weighed indications of strong demand against consensus of increasing supplies next year. Stockpiles slid to the lowest since Feb. 25 yesterday while the premium buyers in Shanghai pay on top of LME prices to secure the metal was $192.50 a ton today, near the record $210 set in August. These signs of demand contrast with estimates from Barclays Plc and the International Copper Study Group of a worldwide glut in the metal that may almost triple to reach a 13-year high of 272,000 tons in 2014.