Gold suffered its most brutal plunge in 30 years
New York - Gold suffered its biggest drop in 30 years on Monday in New York, in a market plagued like other raw materials by the economic slowdown in China and a perceived decline in the inflation risk.
Source : https://www.marocafrik.com/english/Gold-suffered-i...
The benchmark contract for April delivery lost 9.35% to finish at 1,360.60 dollars on the exchange platform Comex futures. It lost up to 10.9% during the electronic trade, falling to its lowest level in two years to 1,338.00 dollars.
The yellow metal had not been in such a tumble on a session in New York since 28 February 1983.
In London, an ounce of gold finished at 1395 dollars at auction night against 1,535.50 dollars on Friday evening, with a decline of 9.15%.
The contract for June delivery, the most traded, has lost up to 11% during the exchange.
Beyond the fall of the precious metal, much appreciated by investors in times of uncertainty and risk aversion, the day also proved historic in terms of participation, with more than 620,000 trade on the contract in June
"r Comex has never experienced such exchanges on a session since the beginning of futures options brokerage in the United States," on December 31, 1974, Damon Leavell, a spokesman for Comex told AFP.
Comex, or Commodity Exchange, is a subsidiary of the operator CME Group, the world leader in derivatives brokerage.
In total, over the last two sessions, gold has lost more than $ 200 an ounce, another record over two days for almost 40 years in the United States.
"I did not expect such a beating," he told Bart Melek, chief strategist at TD Securities raw materials.
"Mounted too fast, too high"
Gold is tilted with the rest of the commodities market, crude copper, through money, after the announcement in the night from Sunday to Mondayof the unexpected slowdown in Chinese growth the first quarter.
The gross domestic product of the Asian giant stood at 7.7% annual rate over the first three months of 2013, surprising analysts who were betting on a slight acceleration, with a GDP of around 8%.
But for analysts, this disappointment was only a pretext to pursue a downward movement of the yellow metal began sharply last week.
"A lot of people try to get rid of their paris on the rise and begin to bet on the decline. Gold was simply mounted too fast, too high," said Mr. Malik.
With the almost irresistible rise since the beginning of the U.S. equity market, which has very huge financial assistance from the central bank (Fed) has chained a race record since early March, investors tend to review their priorities, according to analysts.
"People are wondering what is a safe asset, and increasingly, they tend to go into equities, although Wall Street has not been very successful today," said one broker Italian bank.
On the other hand, signs of a slowdown in Chinese economic indicators and gloomy figures in the United States since early April tend to allay fears of overheating and inflation risks.
However, the risk of inflation is a key driver of asset purchases traditionally considered safe, such as gold. In its absence, and despite the support given stimulus by central banks from Washington to Tokyo, the gold loses one of its most valuable allies.
"All the more so, since the release of the minutes of the last meeting" Wednesday, "many expect the Fed to slow down its program of quantitative easing in the year," added Mr. Melek, "while inflation seems to be still far off. "
On the European side the courses have also suffered "fears of highly indebted countries such as Cyprus, sell their gold to pay their debt," noted Kathleen Brooks, an analyst at Forex.com, which would increase the supply of the market.
The yellow metal had not been in such a tumble on a session in New York since 28 February 1983.
In London, an ounce of gold finished at 1395 dollars at auction night against 1,535.50 dollars on Friday evening, with a decline of 9.15%.
The contract for June delivery, the most traded, has lost up to 11% during the exchange.
Beyond the fall of the precious metal, much appreciated by investors in times of uncertainty and risk aversion, the day also proved historic in terms of participation, with more than 620,000 trade on the contract in June
"r Comex has never experienced such exchanges on a session since the beginning of futures options brokerage in the United States," on December 31, 1974, Damon Leavell, a spokesman for Comex told AFP.
Comex, or Commodity Exchange, is a subsidiary of the operator CME Group, the world leader in derivatives brokerage.
In total, over the last two sessions, gold has lost more than $ 200 an ounce, another record over two days for almost 40 years in the United States.
"I did not expect such a beating," he told Bart Melek, chief strategist at TD Securities raw materials.
"Mounted too fast, too high"
Gold is tilted with the rest of the commodities market, crude copper, through money, after the announcement in the night from Sunday to Mondayof the unexpected slowdown in Chinese growth the first quarter.
The gross domestic product of the Asian giant stood at 7.7% annual rate over the first three months of 2013, surprising analysts who were betting on a slight acceleration, with a GDP of around 8%.
But for analysts, this disappointment was only a pretext to pursue a downward movement of the yellow metal began sharply last week.
"A lot of people try to get rid of their paris on the rise and begin to bet on the decline. Gold was simply mounted too fast, too high," said Mr. Malik.
With the almost irresistible rise since the beginning of the U.S. equity market, which has very huge financial assistance from the central bank (Fed) has chained a race record since early March, investors tend to review their priorities, according to analysts.
"People are wondering what is a safe asset, and increasingly, they tend to go into equities, although Wall Street has not been very successful today," said one broker Italian bank.
On the other hand, signs of a slowdown in Chinese economic indicators and gloomy figures in the United States since early April tend to allay fears of overheating and inflation risks.
However, the risk of inflation is a key driver of asset purchases traditionally considered safe, such as gold. In its absence, and despite the support given stimulus by central banks from Washington to Tokyo, the gold loses one of its most valuable allies.
"All the more so, since the release of the minutes of the last meeting" Wednesday, "many expect the Fed to slow down its program of quantitative easing in the year," added Mr. Melek, "while inflation seems to be still far off. "
On the European side the courses have also suffered "fears of highly indebted countries such as Cyprus, sell their gold to pay their debt," noted Kathleen Brooks, an analyst at Forex.com, which would increase the supply of the market.
Source : https://www.marocafrik.com/english/Gold-suffered-i...