Gold Lock Down Despite Aggressive Plan To Ban Russia From SWIFT, Terrorism & War Risk; Palladium At Multi-Year High Over $900

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Gold Lock Down Despite Aggressive Plan To Ban Russia From SWIFT, Terrorism & War Risk; Palladium At Multi-Year High Over $900

The palladium price made a new 13 year high today and reached $909/oz, its highest since February 2001. Markets fear that the global supply of palladium could be impacted by the threat of further sanctions against Russia.

Palladium in U.S. Dollars - 20 Years (Thomson Reuters)

The Russian mining industry has not been the target of sanctions so far, but with the oil sector already affected and the gas sector possibly the target of upcoming sanctions by the EU, markets remain fearful.

Russia is the world’s largest palladium producer accounting for over 40% of global production. This is mainly through Norilsk Nickel, the world’s largest mining company which mines nickel, copper and palladium in the area of Norilsk in Siberia, the world’s most northerly city. Palladium is mined as a by-product of nickel and copper mining.

The majority of palladium produced is used in automobile catalytic converters and demand has been buoyant recently due to higher sales in the auto industry. Recent miner strikes in South Africa have also disrupted supply for the big South African palladium producers, Amplats, Impala and Lonmin.

Investment demand for palladium has also been strong recently and as acted as a competing demand to industrial users.  

EU Draws Up Further Sanctions Against Russia

Diplomatic fallout from the conflict in Ukraine continues to intensify. Amid claims and counter-claims by the Russian and Ukrainian sides concerning the fighting and incursions in Eastern Ukraine, the war of words has stepped up.

Russian President Vladimir Putin was quoted as saying last Friday that "I want to remind you that Russia is one of the most powerful nuclear nations. This is a reality, not just words." While visiting EU leaders in Brussels at the weekend, Ukrainian President Petro Poroshenko said “we are very close to the point of no return, which is full scale war.”

As fighting continues, European Union leaders met in Brussels yesterday and recommend that the European Commission draw up further economic sanctions against Russia that would be imposed unless Russia demonstrates a de-escalation of its involvement in the conflict in Eastern Ukraine.

The recommended proposal includes “a provision on the basis of which every person and institution dealing with the separatist groups in the Donbass will be listed.”  Donbass is the region in eastern Ukraine that encompasses the Donetsk and Luhansk areas that are currently the scene of the heaviest fighting in the conflict.

Up until now, the EU’s sanctions against Russia have targeted specific individuals, and a number of companies in strategic industries such as the Russian financial sector and high tech oil sector equipment sector.

The next set of potential sanctions is believed to still focus on the energy and finance industries, but would extend to sectors such as Russia’s gas sector., and step up the financial sanctions.

In the financial area, there appear to be plans by the EU to continue to limit access for Russian companies to the western financial markets. Further financial sanctions have also been discussed such as attempting to limit Russian access the sovereign bond markets and access to syndicated lending deals but, for now, these broader financial sanctions appear to be in reserve.

Russia has already imposed a ban on EU food imports and the EU is still fearful of retaliatory economic sanctions from Russia, which could extend to the EU aerospace, shipbuilding and car manufacturing sectors.  This could ignite a harmful trade war which is why some EU member states are hesitant on sanctions at this time.

UK Moots Nuclear Financial Option Of Banning Russia From SWIFT

Last week, the UK was said to be proposing that Russia be blocked from the international SWIFT bank transfer network. If this occurred it would essentially shut Russian banks and other companies out of the international banking network. SWIFT is a Brussels based organisation and so it is obliged to follow any sanctions that are imposed by the European Commission.

However, the very fact that a proposal even exists to shut out Russia from the SWIFT network shows that the Ukrainian crisis is now taking on a more ominous tone, and that geopolitical risk is set to rise from here unless diplomatic intervention can somehow retrieve the situation.

With a heightened terror threat level being imposed in the UK, a potential ratcheting up of sanctions on Russia, and the threat of a larger trade and currency war on the horizon, September should be an interesting month for the precious metals markets.

The UK has raised the country's terror threat level from substantial to severe, its second highest level. MI5 and MI6 said there was no information to suggest an attack was imminent.

The 13 year anniversary of September 11 looms next week and given developments in recent days and weeks, one must be wary of new attacks in the UK , U.S. and other western nations.

Today’s AM fix was USD 1,287.25, EUR 979.34 and GBP 774.47 per ounce.

Friday’s AM fix was USD 1,285.75, EUR 975.83 and GBP 774.55 per ounce.

Gold fell $2.00 or 0.16% to $1,287.30 and silver slipped $0.05 or 0.26% to $19.48 per ounce Friday. For the week, gold was up 0.54% while silver remained unchanged.  

Today, the U.S. markets are observing a national holiday for Labor Day.

Platinum is trading at $1,424, unchanged from Friday. Palladium is again up strongly at multi-year highs at $909, up 1.5% from Friday’s $895.

With the Labor Day holiday today in the US, markets are expected to be quieter than usual, but given that it’s now September, the remainder of the week is set to see higher volumes and more market activity as traders return and refocus following what is traditionally considered the holiday month of August.

by Ronan Manly, GoldCore Consultant. Editor Mark O’Byrne of GoldCore

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3rd Pig's picture


The central bankers are chasing after that crash. They are pushing buttons and pulling levers every day now to get the ponzi to implode.

They can see us begging them for help if it goes down...

Crazy bastards, they pumped that much paper into this ship... the fucker will not sink!


basho's picture

"However, the very fact that a proposal even exists to shut out Russia from the SWIFT network shows that the Ukrainian crisis is now taking on a more ominous tone,"

no, all this means is that davie and mutti merkel and barry are starting to panic as UE unravels before their eyes.

proposals are BS. proposals are words. so far they have done nothing. the sun is setting on the brits.

sales of pampers to the EU/NATO bumpkins is on the rise.

and bye the bye the RU authorities have just confiscated one of Kolomoski's (sp) properties.



Sokhmate's picture

No worries. Absurdium will replace palladium. Much cheaper too

Clowns on Acid's picture

Victoria Nuland doesn't understand the meaning of Swift.

fibonacci's claus's picture

Basal III bonds !!!

THe idea is to push financing away from corporates and into countries for sovereign debt financing.  How this will create jobs I don't know.  I guess they figure we will all have nice neat govt jobs.  This means sell lots and lots of bonds from lots and lots of different countries.  Basically, blow up the bond market, at the other end there will be winners and losers i guess.  Government becomes the only one who can access credit.  And corps become zombie organizations of the countries. 

Suddenly sovereign debt isn't so risk free.  And there will be much more to be sold.  There will continue to be deleveraging of the debt and that means losses.  Basal III bonds were designed to take losses.  and I figure all the sovereign debt being issued will take losses also.  Interesting how all of a sudden the worlds bond yields have come to parity. 

The whole thing will create bigger and bigger black markets.  So if you have gold and use it, it will probably be a crime.


fibonacci's claus's picture

 it will be a swift kick in the ass.

Hongcha's picture

My Amerikan leaders are ZOG asspuppets.

bardot63's picture

If the U-S and EU really want to harm the Russian economy, they would be locking Russia into using the dollar, not the opposite by kicking Russia out of SWIFT.   When the derivative debt implosion of hundreds of trillions of dollars finally occurs, Vlad would be the last man standing.

My Days Are Getting Fewer's picture

Does anyone think that China will be excluded from Swift.

China will launder Russia's Swift processing.

At the same time, China and Russia will set up a parallel system.

If the pace of moronity continues, the USA will financially implode much sooner than expected.

In 2008, I figured that the USA could hold the deal together with baling wire and glue until 2020.

In 2014, with desperate moves becoming the flavor of the hour, I feel that the currency reform/ National Chapter 11 event is a couple of years off.

Canucklehead's picture

I don't think you understand SWIFT. Would you care to explain how China would launder Russia's Swift processing?

Bossman1967's picture

They don have he balls to shut Russia out of swift cause they will loose thier winter oil and Id do it anyway fuck them

Cacete de Ouro's picture

If SWIFT goes down then how are we expected to pay the deposit for the Russian bride?


actionjacksonbrownie's picture

Gold is toast this a.m.  Support is broken and $1200 is a given. Don't be surprised when Gold freefalls through $1200 - how low it will go is anyone's guess, but this is not the time to be holding.

Azannoth's picture

Gold mining is not viable under 1000 and hardly profitable under 1200, even if it dips it will be for a very short while

samcontrol's picture

I have to wait for $1900 to hold it again ?


My "guess" is now is a good time to buy, full retard actually.
phys pms, miners , paper pms, leveraged pm or miner etfs, and a shit load of silver options. I am at about 25% of my total wealth! hope to double in 5years that part.

MoneyThimbles's picture

Should Russia be shut out of SWIFT, it will clearly have no option but to pay monies that fall due on its sovereign bonds, held abroad by foreigners, into a special account in some suitable Russian bank, to be collected at some date in the future when SWIFT access is turned back on.


Cognitive Dissonance's picture

"The dividend check is in the mail." - Putin

philipat's picture

Russia and China (And others later) will create their own alrenative system. Union Pay, the Chinese Credit Card, is already the most widely used CC globally and it has all its own back-office systems. London really does seem determined to shoot itself in the foot doesn't it??