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Gold Demand in Greece, Italy, Spain, Russia, Germany, UK and U.S.

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Jan Harvey from Reuters interviews Mark O'Byrne, Director of GoldCore Research
Jan Harvey from Thomson Reuters interviews Mark O'Byrne, Director of GoldCore Research
Jan Harvey thomsonreuters.com We were hearing quite a bit about rising physical demand in Europe earlier this year, as a confluence of factors (euro zone QE, SNB scrapping franc peg to euro, Greek election outcome) came together to support buying. Here to discuss how that has developed in February is Mark O'Byrne, executive director of Goldcore. Welcome, Mark!
Mark O’Byrne goldcore.com Happy Friday Jan and thanks for having me on the forum
Jan Harvey thomsonreuters.com Great to have you with us. How have sales this month compared to last?
Mark O’Byrne goldcore.com The month started very strongly with momentum from January but after a busy start demand tapered off as risk appetite returned and gold prices gave up the gains seen in January.
Jan Harvey thomsonreuters.com How are you expecting that trend to continue as the year progresses?
Mark O’Byrne goldcore.com Overall - sales are marginally down in February on January - down 6%. Price weakness is again making investors hesitant - particularly buyers in the UK and U.S.
Mark O’Byrne goldcore.com Very difficult to say as a lot of potential "event risk" and obviuosly the price will be important. We are constructive on the price for the year but as ever nervous regarding short term corrections. No crystal balls but the uncertain geopoitical and monetary backdrop is a positive environment for gold. Indeed, we believe global bond and stock markets are looking very toppy and bubbly and material corrections in either market should be beneficial for gold.
Mark O’Byrne goldcore.com Of note is fact that we had 4% more account openings in February than in January despite the drop in sales. Many new clients have funded accounts and are waiting to allocate their funds. With today being the last day of trading in February, this means that March could see good demand.
Jan Harvey thomsonreuters.com How has demand compared in different regions of Europe so far this year?
Mark O’Byrne goldcore.com Unless that is - we see further price weakness or indeed gold going sideways for a period of time - which is also possible although I think unlikely given global demand being quite robust.  A sharp fall in the price or indeed a sharp increase in the price will bring out buyers. Sideways trading creates hesitancy, concern and a lack of demand.
Mark O’Byrne goldcore.com We saw an uptick in demand in most countries in January - both English speaking world and other countries. There were a lot of 'events' that led to this demand - Charlie event in Paris, SNB Swiss Franc debacle, Ukraine and tensions with Russia and the start of renewed concerns about Greece
Mark O’Byrne goldcore.com  This UK and U.S. demand then tapered off in February - however Greek demand has remained quite high and German demand is robust
Mark O’Byrne goldcore.com Greece saw the greatest increase in demand in January and this continued into the end of February. Gold sovereigns and bars remain the most popular - some for delivery but more for storage, Zurich primarily. British sovereigns remain the traditional favourite of Greek investors -  for historical and familiarity reasons.
Jan Harvey thomsonreuters.com Are there any particular products that have been favoured this year?
Mark O’Byrne goldcore.com In general we have not seen any particular gold coin or bar format being favoured (except in Greece). As we deal with investors and some HNW and family offices - they tend to favour bullion in the cheapest format possible. This used to be London Good Delivery bars but kilo bars are increasingly popular for price conscious, sophisticated buyers. Sovereigns remain popular in the UK too as they are CGT free - making them attractive from a total expense point of view.
Mark O’Byrne goldcore.com We have seen no material increase in demand from Italy and Spain where demand remains anaemic. We saw a marked pick up in Russian demand in December when the rouble was collapsing but that has abated now. This included HNW demand for bullion stored in Zurich.
Mark O’Byrne goldcore.com We saw a marked pick up in Russian demand in December and early January when the rouble was collapsing - this included HNW demand for kilo bars and bullion stored in Zurich was favoured. That demand has abated
Jan Harvey thomsonreuters.com How has silver demand compared to gold this year?
Mark O’Byrne goldcore.com That is interesting as ever. Silver demand remains robust and for retail buyers of coins , there remains a propensity to favour silver eagles, maples and philharmonics over gold bullion coins.
Mark O’Byrne goldcore.com Smaller buyers are taking the view that they can get more 'bang for the buck' with 'poor man's gold' and many also believe that silver will outperform gold in a new bull market and we agree with them on this. Many saw how silver outperformed gold in the 1970s and again in the 2000s bull run.
Jan Harvey thomsonreuters.com It had a couple of enormous reversals in 2011, though. Has that made investors a bit warier than they once were about taking a punt on silver?
Mark O’Byrne goldcore.com Has definitely deterred the typical retail investor. But hard core silver bugs love their silver and view all sell off as gifts from the Gods to accumulate the 'metal of the moon'  : )
Jan Harvey thomsonreuters.com Ha!
Jan Harvey thomsonreuters.com Thanks Mark. And thank you very much for joining us today!
Mark O’Byrne goldcore.com p.s. dislike term silver bug and gold bug. Pejorative and we don't call people stock roaches or paper bugs or dollar bugs   : )
Mark O’Byrne goldcore.com Pleasure Jan. Thank you for the opportunity and enjoy your weekend. Hope we beat you in the rugby in the big game Sunday !
(Ireland versus England in 6 Nations. Result: Ireland 19-9 England)

 

MARKET UPDATE

Today’s AM fix was USD 1,216.75, EUR 1,084.93 and GBP 789.48 per ounce.
Friday’s AM fix was USD 1,205.00, EUR 1,073.59 and GBP 782.77 per ounce.

Gold climbed 0.22% percent or $2.70 and closed at $1,211.10 an ounce on Friday, while silver rose 0.18% or $0.03 to $16.57 an ounce. Gold and silver both finished up for the week at 0.84% and 2.09% respectively.

Gold in US Dollars - 5 Years
Gold in US Dollars - 5 Years

Gold in Singapore climbed to its strongest price in almost two weeks, strengthened by firm Chinese demand after an interest rate cut in China which is a positive for the yellow metal. In late afternoon in Singapore, gold bullion was up 0.7 percent at $1,221.40 an ounce its highest since February 17th. In February, gold lost 5.5 percent its most since September 2014.

Premiums at the Shanghai Gold Exchange (SGE) remained firm near $4-$5 an ounce over the global spot benchmark.

The Chinese central bank said the 25 bp cut in the benchmark lending and deposit rates "does not represent a change in the direction of monetary policy". However, this is just another example of a central bank employing quantitative easing as the currency wars continue and look set to intensify.

On Friday, Q4 U.S. economic growth was revised downward to 2.2 percent from 2.6 percent which may have added to safe haven bid for gold. The U.S. non farm payrolls report is at the end of the week and market participants will look to it for further evidence that the US is slowing down.

India will introduce gold deposit accounts to utilise the 20,000 metric tonnes of gold in the country and launch a sovereign gold bond, the finance minister said on Saturday. A further sign of gold being remonetised.

India kept the import duty at the record 10 percent in a setback for jewellers and a boon for smugglers.

Gold in London in late morning is trading at $1,216.65 or up 0.31 percent, while silver is at $16.65 or up  0.37 percent and platinum is at $1,185.50 or up 0.14 percent.

Breaking News and Updates Here

www.goldcore.com

 

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Tue, 03/03/2015 - 13:46 | 5850211 Quinvarius
Quinvarius's picture

I don't think there has been much retail participation in gold for 15 years or more.  The US mint makes a few tons of gold coins a month or so.  It is going to take a lot for the public start connecting the dots and getting involved.  I think we would need to see 7-8k an ounce before people start realizing the jig is up and start buying.  By then they will have already been financially destroyed.

Tue, 03/03/2015 - 04:08 | 5848750 Manipuflation
Manipuflation's picture

I will buy more gold.  When would be a better time than now?

Tue, 03/03/2015 - 02:06 | 5848608 manofthenorth
manofthenorth's picture

"But hard core silver bugs love their silver and view all sell off as gifts from the Gods to accumulate the 'metal of the moon'"

Guilty

Thanks for the cheap shiny you dirty "paperbugs"

Mon, 03/02/2015 - 16:58 | 5846911 WTFRLY
WTFRLY's picture

The whole war in Syria is dirty, Serena Shim had proof and they killed her.

 

New Anonymous op as White House still ignores murder of American reporter Serena Shim in Turkey

Mon, 03/02/2015 - 16:38 | 5846797 _SILENCER
_SILENCER's picture

http://www.myfoxny.com/story/28238870/4-million-in-gold-stolen-from-truc...

 

There must be a demand in the states...someone just boosted 4 Million dollars worth. Keep stackin, fellas.

Mon, 03/02/2015 - 15:33 | 5846442 Consuelo
Consuelo's picture

All that is needed is for the U.S. to tell China what it can or cannot do in it's own sphere of influence - perhaps a time or three more.    The events have to be newsworthy however.   Maybe an island dispute, or a confrontation with the Japs, or a dust-up with the U.S. Navy in disputed waters somewhere - you know the drill...   The Chinese aren't going initiate gold-backed launch sequence until the appropriate time.

Mon, 03/02/2015 - 14:49 | 5846274 f16hoser
f16hoser's picture

I'd rather Fondle my Silver than my Wife! Oop's, did I say that outloud?

Mon, 03/02/2015 - 15:36 | 5846452 remain calm
remain calm's picture

How ugly is she?

Mon, 03/02/2015 - 14:34 | 5846215 pitterrier
pitterrier's picture

WILSON, NC — An armored truck carrying approximately $4 million worth of gold and silver was robbed Sunday by three armed men.

Funny, no paper gold, all physical.

Mon, 03/02/2015 - 14:25 | 5846182 walküre
walküre's picture

This is true and will become true-er as more banks start bail-ins and Greece either receives a bailout or refuses to take one. What does it matter anymore? Shit has hit the fan but they won't admit it. As long as perception and "faith" holds...

We were hearing quite a bit about rising physical demand in Europe earlier this year

 

GOLD IS KING. SILVER IS CROWN PRINCE.

*** SPOILER ALERT ***

Faith in all fiat is eroding as Central Bankers try to talk their way out of this mess.

 

Mon, 03/02/2015 - 14:13 | 5846152 Fukushima Fricassee
Fukushima Fricassee's picture

I will buy all the FED discounted metal you can to sell. Once it blows up in your faces , if you come to take it from me later or tax it because of your mistakes it will mean your asses.

Mon, 03/02/2015 - 13:43 | 5846057 Bossman1967
Bossman1967's picture

Paper metals suck. At the end of this paper tiger regardless of where the price is I own an actual physical good thwt is tangible. Can you buy it for 1200 an ounce great luck

Mon, 03/02/2015 - 13:54 | 5846091 KnuckleDragger-X
KnuckleDragger-X's picture

Don'cha know that paper is cool while the hard shiny stuff is a barbaric thing of the past, so everybody should sell me that nasty metal and I'll give you some super neato keen paper for it since I am, after all barbarian.

Mon, 03/02/2015 - 20:15 | 5847716 RaceToTheBottom
RaceToTheBottom's picture

Walk like a Barbarian....

Mon, 03/02/2015 - 13:34 | 5846028 disabledvet
disabledvet's picture

I think you better start looking at the supply side now.

Mon, 03/02/2015 - 13:34 | 5846025 disabledvet
disabledvet's picture

I think you better start looking at the supply side now.

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