Gold prices looped off from 0.88% to $1,661 in a day an ounce. Standard and Poor’s Depositary Receipts (SPDR) Gold Shares on Government Logistic Department (GLD), track a fall of 160.70 from 0.79% in 10th of an ounce of gold bars. There is a drop of 0.07% to 45.38 in Market Vectors Gold Miners Exchange Traded Fund (ETF). The gold prices get lowered from 20 Dec to 4 Jan near $1,580 and 158 on GLD an ounce for gold.
Gold in China
Harry Dent who is founder of HS Dent which is a stock market and economic research center in Tampa, Fla said that China has begun stimulating which is positive for gold in China as U.S growth in gold is slow this will give chance to china and Europe to accelerate again. Furthermore he said that traders should by the yellow metal on the hope that prices will rise to a new height at the end of February or May.
In China, consumer prices have raised to 2.5% in December which was 2% in the previous month.
US and China
Negative real interest rate of the gold bulls in the U.S and other countries makes it appealing because it holds more opportunity cost than cash.
John Hathaway who is portfolio manager of Tocqueville Gold Fund wrote in a letter that Gold will rise to a new height this year because of extension of negative real interest and increasing concerns in western countries over direction of financial and economic affairs and these concerns will be intensified by the resumption of weak economical activity in following year. In addition to this he wrote that gradual increase in economic growth in following year is expected by investors but he believe that recent increase in tax will weaken the economic activity which will widen the debit.
Walter de wet, who is an analyst at standard bank, he wrote that gold should resistance at $1,700 and price support at $1,660 and if gold break through $1,700, target of $1,720 can be achieved. This shows Inflation in Chinese gold prices.