GOLD PRICES edged higher late in London on Tuesday, rising to a 3-session high of $1126 – but missing the 2.7% jump in silver – as US traders returned from the Labor Day holiday.
Asia led a strong rise in European and US stock markets, gaining 1.6% for the day.
Copper surged 4.5%, extending Monday’s jump on news that major producer Glencore is mothballing some output, helping push broad commodity indices higher as crude oil also rose.
New data from China – the world’s No.1 consumer of most major commodities – today showed copper inflows growing in August from July.
Overall however, the value of imports to the world’s second-largest economy sank 14% year-on-year
, helping push China’s trade balance of exports over imports some 40% higher to a new all-time record of almost $58 billion.
“Gold is currently in no-man’s land,” says a note from Swiss investment and bullion bank UBS, “and investors are understandably hesitant to put on sizeable positions ahead of the FOMC meeting next week.”
“Physical demand for gold remains rather subdued,” says Chinese-owned ICBC Standard Bank’s commodity unit, “immune from the mini-risk on bounce that has lifted most other commodities.”
Silver bullion jumped Tuesday, nearing its highest level in 2 weeks at $14.86 per ounce.
That pushed the Gold/Silver Ratio of relative prices down towards 75 for the first time since mid-August, and markedly down from last month’s 6.5-year peak near 79 ounces of silver per 1 ounce of gold.
Gold priced in Turkish Lira meantime hit new 4-year highs, worsening the demand outlook in the world’s No.4 consumer nation.
“Sales are not terribly slow,” the Cihan news agency quotes İsa Altıkardeş, president of the Bursa Chamber of Jewelers, “[but] if prices continue to rise, I believe sales will continue to slow.
“We tradesmen want to see prices fall
and this period of slow sales to end…Jewelers are tired of the daily fluctuations.”
Weaker Asian currencies are continuing to impact local gold demand, said a note Tuesday from analysts Thomson Reuters GFMS.
Shanghai gold prices ticked lower overnight, but extended their premium above London quotes – incentivizing new imports of bullion to China, the world’s No.1 consumer nation – to more than $5 per ounce.
US analysts at Bank of America-Merrill Lynch have cut their 2015 average price target in Dollar terms, down 7% to $1122 with a forecast of sub-$1000 in 2016.
Gold prices have so far averaged $1182 in 2015, down from $1266 per ounce in 2014.