| CATEGORY: COMMODITIES |
Commodities: Gold buoyed by India purchases |
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By Michael Hewson
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Tue 03 Nov 2009
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LONDON (SHARECAST) - Gold has continued to make gains today, despite a rally in the US dollar index to levels last seen on the 5th October.
Last week the Gold price looked as if it was going to correct lower towards the $1,000 mark, but this was turned around just shy of trend line support at $1,026.60.
Today's news that India had bought 200 tonnes of a potential 403.3 tonnes of Gold from the IMF was also seized upon by the market.
The purchases took place in the 2 weeks preceding 30th October when Gold was trading in its range between $1,030 and $1,070.
This move by India seems to support the speculation that countries are diversifying away from currencies as part of their reserves.
It has already been speculated that China may also be doing the same thing and while there is concern about currency debasement a lot of money will continue to go into Gold and potentially propel it to further new highs as central banks and investment funds look at ways to protect the values of their portfolios.
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