LONDON (Commodity Online): The largest Gold ETP, SPDR, slipped lower on Monday by 1.52 tonnes but overall metal held remains stable. But, more importantly, physically demand for gold from Asia remains very strong from India and from China following the week-long holiday. Gold bar premiums in Hong Kong have risen to $3/oz, their highest since February and are at 50 cents/oz in Tokyo.
Although prices have surrendered some of Monday’s gains in early trade this morning, they continue to trend higher. As the dollar weakened against the euro, Palladium was the strongest performer Monday gaining 4.2% to close at $610.3/oz while gold gained 2.2% to settle at $1674.9/oz ahead of Slovakia’s first vote in Parliament today on the approval of the enlarged powers of the EFSF.
Prices have drawn comfort that European policymakers may be getting closer to a comprehensive and coordinated effort to address the deterioration in sentiment toward euro area banks. Our economists note the central bank announcements of unconventional measures are a first important step towards this.
Aquarius Platinum has reported some contractors at its Everest mine (2010 platinum output: 32koz) have commenced strike action. The mine is currently ramping up to full operating levels after it had been placed on care and maintenance; they had forecasted the mine to produce 75koz of platinum this year.
Meanwhile, Impala Platinum has averted strike action, and reached a two-year wage settlement with the National Union of Mineworkers. In line with the industry, an increase of 8.5-10% was reached for the first year and 8-10% for the second year.
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