Posts Tagged ‘bullion market’

SILVER……GROWING AVENUE OF INVESTMENT

Recently silver, known as poor’s gold, is gaining not only against the dollar and other old world currencies but also outperforming gold. Due to high prices gold is loosing its own attraction from common man and importance of silver as precious metals is gaining momentum. The declining trend of gold/silver ratio indicate that silver become better destination for investment. Like gold, silver has retained rally momentum due to recent poor economic data that has caused investors to purchase Silver as a “safe haven” alternative investment. The pickup of silver industrial demand due to the emergence and growth of a number of new end uses, and continued strong investment demand is pushing silver prices sharply higher.

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Like all metals, London Bullion Market is the global hub for silver trading, while the New York’s Comex Futures dominate the solver fund activity. The world’s largest silver backed exchange-traded fund, the i Shares Silver Trust, said its holdings rose to 9,280.40 tonnes by Sept. 1 from 9,151.03 tonnes on August 5.

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Global demand- supply of silver According to World Silver Survey 2010 , global silver mine production rose last year, by almost 4%, its seventh straight annual increase to reach a record high of 22,072 ton.Peru is the world’s largest silver producing country followed by Mexico, China, Australia and Bolivia. GFMS is forecasting a further mine production rise of 3 per cent this year.

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According to GFMS, In the last ten years, the world jewellery demand was down 8 per cent and silverware as much as 38 per cent. And because of technology changes silver use in photography sector had suffered a major fall of 62 per cent. But as strengthening of belief in silver as a precious metal is the 145 per cent demand gain since 2000. The industrial application of silver is almost 48 per cent of total silver use.

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Indian demand- supply of silver Though India is generally believed to have a great appetite for gold, Indians also love to possess silver in their homes for jewellery. India is voluminous importer of silver. Of the 4,000 tonnes that India used to import annually, around 2,600 tonnes was used to make jewellery and ornaments. MMTC is the largest importer of gold in the country. The firm’s silver imports fell by more than 44% in the fiscal year to end March 2010, as high prices dented demand. More than 60% of India’s silver demand comes from farmers.

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Last year silver demand dipped because the country experienced one of the worst monsoon seasons in over four decades. However, with much better monsoon this year, the situation is set to reverse and India’s appetite for silver has also been boosted because gold has become too expensive at current prices. According to official data, India’s silver imports in the first six months of 2010 are up 579%.

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From April this year, India has also started hallmarking of the white precious metal to ensure purity. With increasing amounts of impurities in jewellery being sold across the country, public sector trading major, Minerals and Metals Trading Corporation (MMTC) is banking on its branded jewellery, silverware gift items and coins to push up its market share.

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Like gold, silver has not enjoyed equal recognition from hedge funds, pension and retirement funds, insurance companies, and sovereign wealth funds– but this is likely to change as fund managers recognize silver’s relative value and simply wish to diversify their precious metals exposure.

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Outlook

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Good monsoon, high gold prices and global trends may help silver outperform the yellow metal in India. Better harvesting will underpin demand from the farming community this year. Since gold prices are trading over `19,000 per 10 gm, many rural families are now switching to silver.The weakening of rupee also supporting the prices.

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More and more people here are using silver as a speculative commodity play as many others are looking at it as a safe haven asset. The overall market sentiment is bullish for silver. So it could be a more decisive silver price breakout before the year ends to touch the level of `33500.

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Gold suffers biggest fall of 2009, down by Rs 440

Gold declined by Rs 440, stopping the rising trend of several weeks whereas due to heavy selling by stockist in the midst of weakening global trend, gold lost 2.47% at Rs 17,360 per ten grams in the bullion market.

However, the yellow metal lost Rs 510 on Saturday which is the steepest for the year, taking the loss in the past 5 trading sessions to Rs 1,260 after touching a record high of Rs 18,550 on December 3.

Meanwhile, a similar weakness was seen in silver, which has been under selling pressure ever since the metal in international markets fell from over 19 dollar to trade near $17 an ounce.

On the other hand, silver ready declined 420 to Rs 28,080 per kg and weekly-based delivery by Rs 1,220 to Rs 27,680 per kg on reduced off take by speculators.

Trading sentiment dampened on reports that gold declined 0.2% to 1,125.90 dollar an ounce in Asia while the metal in futures trading also extended losses by losing 1.4% to 1,127.40 dollar an ounce in New York.

Further, standard gold and ornaments fell sharply by Rs 440 each to Rs 17,360 and Rs 17,210 per ten gram respectively while sovereign lost Rs 100 at Rs 14,000 per piece of eight gram.

Silver ready dipped by Rs 420 to Rs 28,080 per kg and weekly-based delivery by Rs 1220 to Rs 27,680 per kg while silver coins tumbled by Rs 300 to Rs 33,700 for buying and Rs 33,800 for selling of 100 pieces.

Precious Metals are on Record Setting Spree :)

Precious Metals are on Record Setting Spree

 

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As gold rallied by Rs 80 per ten grams to Rs 17,095 and silver firmed up by Rs 110 per kilo to Rs 28,510 due to constant demand from stockiest on account of rising trend  in global market, both gold and silver resumed at a record high on the bullion market.

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However, due to worries about future inflation and economic uncertaintiesanother record high in the Asian marketgold hit , while Asian stocks bounced back as the bearish dollar kept assets in demand.

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Meanwhile, spot gold increased as high as $1,143.95 per ounce in early Asia trade, settling just above $1,140 while standard gold rose by Rs 80 per ten grams to resume Rs 17,095 from the overnight closing level of Rs 17,015.

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On the other hand, pure gold also firmed up to Rs 17,185 from Rs 17,105 while silver ready too hardened by Rs 110 per kilo to Rs 28,510 from Rs 28,400 previously.

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Earlier due to frantic buying by jewellers in the midst of firming global trend, gold prices touched a record high of Rs 17,300 per 10 gram in the bullion market and Silver coins also set a record by adding Rs 400 to Rs 33,900 for buying and Rs 34,000 for selling of 100 pieces.

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Moreover yesterday silver also rose by Rs 1,000 to Rs 28,350 per kg.

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Sudden Surge and the record setting spree in the precious metals can be attributed to frantic buying of gold in marriage season.

In between, gold in international markets too has climbed to a record high along with the weakening of dollar.

IMF Sells 200 Tonnes of Gold to RBI

Gold-surges-alltime-high

IMF Sells 200 Tonnes of Gold to RBI

The International Monetary Fund has sold 200 tonnes of gold to the Reserve Bank of India (RBI) for $6.7 billion in order to shore up the Fund’s finances to enable it to boost the concessional lending to the world’s poorest countries.

This sale of gold to India represents almost half of 403.3 tonnes of total sales volume, which was approved by the IMF Executive Board September 18.

IMF said that the transaction involved daily sales, which were phased over a period of two-week during October 19-30.

The price at which the each daily sale was conducted was set on the basis of market prices prevailing that day, it said.

This deal will increase India’s gold holdings to the tenth largest among the Central banks.

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“I strongly welcome this transaction with the Reserve Bank of India,” Managing Director Dominique Strauss-Kahn stated.

“This transaction is an important step toward achieving the objectives of the IMF”s limited gold sales programme, which are to help put the Fund”s finances on a sound long-term footing and enable us to step up much-needed concessional lending to the poorest countries.”

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The IMF, which currently holds 3,217 tonnes of gold, is the third-largest official holder of the precious metal after the US and Germany.


The IMF has made gold sales a key element of its new income model aimed at lowering its dependence on lending revenue to cover expenses.


Under the Fund’s Articles of Agreement, all gold sales must be conducted at prices based on market prices, including direct sales to official holders as in the case of this transaction with India, the IMF said.


The Group of 20 key developed and developing countries, at their April summit in London, agreed the gold sales should allow the IMF to offer favourable conditions on loans to the poorest countries.


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Imports of Gold Jumped to 37.5 Tonnes in September

Imports of Gold Jumped to 37.5 Tonnes in September

Imports of Gold Jumped to 37.5 Tonnes in September


The imports of Gold surged by 72 per cent to 37.5 tonnes in September as compared to previous month due to the increased demand during festive season.

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The gold import in August stood at 21.8 tonnes after witnessing a growth of nearly three-fold from 7.8 tonnes in July, data provided by the Bombay Bullion Association showed.

The volume of shipment surged due to festive season demand, Bombay Bullion Association quoted.

Moreover, BBA has said that the imports is likely to decline from this level in October after the festival demand is over.

During the festival season, this year, the demand was more for gold coins than for retail jewelery as the prices were hovered above the Rs 16,000 per 10 grams level.

The high prices are likely to affect the demand.

The gold prices were ruling at Rs 15,898 per 10 grams for MCX December delivery while it stood at 1,034.8 dollar an ounce (28.34 grams) on the international comex.

The imports stood at 54 tonnes in the same month last year.

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Gold Breaks 16K Mark, Silver Hit New Highs :)

Gold Breaks 16K Mark, Silver Hit New Highs

Gold Breaks 16K Mark, Silver Hit New Highs

Due to constant festive demand in the midst of rise in the overseas markets, benchmark Gold prices increased by Rs 105 per 10 grams to break the Rs 16,000-mark in the bullion market while silver continued to hit new highs.

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However, due to higher international advices, silver went to a record peak on constant industrial demand while on the Comex division of the New York Mercantile Exchange, gold for October delivery rose to $1,064.20 an ounce.

Moreover, the contract had previously touched a high of $1,068.40 an ounce and December silver futures closed at $17.84 an ounce from $17.82.

Additionally, in Tokyo, gold was below the all time high levels as dollar decreased to fresh 14-month lows against its major rivals.

On the other hand, in the local market, benchmark gold increased by Rs 105 per 10 grams to restart at Rs 16,035 from Monday’s closing level of Rs 15,930.

Similarly, pure gold also rose by a similar margin to Rs 16,110 from Rs 16,005 while silver ready hardened by Rs 95 per kg to Rs 28,150 from Rs 28,055 previously.

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