Gold & silver see a little demand after relentless selling. Headline risk out of Syria also brings in buyers.
Bullion.Directory precious metals analysis 23 September, 2014
By Christopher Lemieux
Senior FX and Commodities Analyst at FX Analytics
Headline risk out of Syria blows a little life back into gold and silver, up .67 and .51 percent respectively. The eight-month low in gold and four-year low in silver, also, brought in physical buyers who are most sensitive to price movements in the metals. Silver, currently trading at $18.87 per ounce, bounced from a $18.325 per ounce low set in early trade yesterday.
The precious metals complex, including palladium and platinum, move higher as the US conducts airstrikes in Syria. The US air campaign was supported by Arab allies, in order to stunt progress of the Islamic State. The bombing was concentrated around the self-proclaimed Islamic State capital in Raqqa, Syria.
“The metal seems to have been supported by some safe-haven buying after news emerged that the US has launched air-strikes against ISIS militants in Syria,” said Abhiskek Chinchalkar, an analyst at AnandRathi Commodities in Mumbai.
There are reports that Israel has shot down a Syrian warplane that was flying over the Northern city of Golan.
China, the world’s largest gold producer, is showing demand in the yellow metal. Volumes on the Shanghai Gold Exchange (SGE) were the fourth-highest since June, as gold hovered around $1,215 per ounce. India is stepping up its buying, too, ahead of the festival and wedding season.
The pullback in the dollar is giving commodities a breather from last week’s declines. Amid the current headline risk, the majority of analysts are still optimistic on the US economy and believe gains are limited and short-lived.
S&P 500 futures are down and have declined roughly 25 points in the last two days.
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