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HSBC’s Respected Steel Says Gold Over $1,600/oz In 2013
Today’s AM fix was USD 1,379.75, EUR 1,035.54 and GBP 882.76 per ounce.
Yesterday’s AM fix was USD 1,386.25, EUR 1,039.71 and GBP 885.33 per ounce.
Gold fell $5.40 or 0.39% yesterday to $1,383.30/oz and silver and finished up 0.18%.
Gold is lower in most currencies today except sterling which has come under pressure.
Gold is lower in most major currencies again this week and very marginally lower in dollar terms – down 0.2% for the week. A lower weekly close would again be bearish technically and could signal further weakness.
Cross Currency Table – (Bloomberg)
The most recent increase in duties on gold, curbing of gold financing and restrictions on gold imports by banks and state-run trading companies to a consignment basis in India have led to the expected short term decline in demand which may be contributing the gold’s inability to close above $1,400/oz.
Gold Adjusted For Inflation (CPI) 1970 to Today
James Steel, chief commodities analyst at HSBC in New York continues to be constructive on gold in the medium and long term and sees gold rising to $1,600/oz in the second half of 2013.
In a Bloomberg audio interview, Steel said that this year the gold market has been under pressure and has experienced a rotational shift out of commodities in general driven by the constant chatter of a tapering off in QE and experienced very steep declines in mid April. He likens it to a rugby scrum pulling back and forth near the $1/400oz level, between ETF outflows and strong physical demand for coins and bars, notably from China.
Steel said that in the past few weeks the heavy ETF outflows have died down, and prior to this year they were mostly static. The peak for ETF's was 85M ounces at the end of last year. He says most institutions have already exited that wanted to get out.
Market chatter has been nervous about the unwinding of QE3. Steel points out that unwinding or paring back is very different than an exit. The Fed many need to do tapering for a long time before it ends their program.
Steel mentions that it was the jewellery market that drove the gold market in the past and now it is investment demand and demand from China. He believes gold will average is $1,542/oz and he is predicting a rally in the second half of the year up to $1,600/oz. Longer term, he is on record as saying that gold will rise to over $2,000/oz.
Gold in USD, 3 Year – (Bloomberg)
Steel has specific responsibilities for precious metals in HSBC and is one of the more astute analysts of the gold market working in the banks. He knows his financial, economic and monetary history.
Prior to joining HSBC in 2006, he ran the New York research department for Refco, a large US commodities brokerage house. Jim also worked for The Economist in the Economist Intelligence Unit covering commodity producing nations.
Unlike some widely covered ‘celebrity economists,’ Steel has a deep knowledge and understanding of supply and demand and the other fundamentals driving the gold market.
NEWS
Gold edges lower for second session on stimulus fears - Reuters
Gold Drops as SPDR Assets Decrease Amid Fed Stimulus Speculation - Bloomberg
Platinum Outshines Gold Amid Supply Concerns - Bloomberg
Gold Bears Return as ETP Rout Extends to 17th Week - Bloomberg
COMMENTARY
Video: GoldCore on Russia Today On Gold, Silver, Bonds And Ireland – You Tube
Audio: HSBC’s Steel Says Gold To Over $1,600/oz By End 2013 - Bloomberg
Why Fundamental Rationale For Holding Gold Is As Robust As Ever – Sovereign Man
Roubini's Misguided Attack On "Gold Bugs" – Zero Hedge
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GoldCore (similar words to Bullion & Banks) rushes out yet more desperate garbage to counter the tanking trend in the precious metals market
the last time it tanked he was singing a chorus in perfect harmony with Sinclair, Turd Ferguson and Silver Doctors about a buying rush in outer Mongolia and the far reaches of Asia
it (journalism.. cough!) doesn't get more desperate than this dumb propaganda
sorry to piss on your parade GoldCore, it's a dirty job you have there, they had to find some souless idiot to buy and you just fitted the bill ...hope they're not paying you peanuts, thank fuck you don't have to use your real name eh!
Price manipulation we are seeing via paper derivatives is to keep the priceof physical low enough for two ends. 1.) allow the Chinese to accumulate enough physical to participate in a PM backed currency that will replace e dollar when it collapses in another 2-3 years, and 2.) allow JPM and the NY Fed to accumulate enough physical to give the Germans their gold back ( they told them it would take 7 years). When the big players and nation states have shaken all the physical out of the weak hands, then gold will hit it's true market price of 10k/ oz and be used to back the new global currency, something akin to the SPD. This is the game, not that hard to see.
Gold adjusted to inflation, according to shadowstats: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/3/3_The...
...and gold vs US debt: http://rpreschern.files.wordpress.com/2013/01/goldvsdebt.jpg
Wonder what the "Hongkong Shanghai Banking Corporation"rates one ounce of, Coce or Opium, to be around christmass,wash my laundry,please!
Sincerly:Minister of Love!
AKA: shits gonna hit the fan in the fall
Steel loves gold.
If there's anything the last 5 years has proven, it's that all the pundit are terrible at accurately, and consistently predicting the price of gold, and silver.
Who needs gold when you can have all the digital FRN's you want with one call to Bennie & The Feds?
Commodity gold prices, priced by paper...what do they really mean?
It would seem that if China really wanted all the gold it seems to want that they could easily hoover up all the physical available.
There is a game being played on another level that we can't see.
I suspect figuring it out would be quite rewarding.
I suspect Steel knows of a way to 'nudge' the market to $1600 within the next two weeks. Not too far to go from $1380 this a.m.
HSBC has the most Comex deposited metal in stock, so they have a lot at stake regarding gold price movements. I would generally put a stronger weight on what JPM, HSBC, and Scotia analysts say about gold (either positive or negative), as they have real skin in the game.
Absolutely correct. These are the guys that pull the strings on the manipulation via derivatives. Wel, them and the fed of course. They used Morgan Stanley and merril lynch last time, as was reported here on ZH.