The Phaserl


The importance of round numbers, Iraqi gold & diversification

by Geoff Candy,

GEOFF CANDY: Hello and welcome to this week’s edition of’s Gold Weekly podcast. Joining me on the line is Precious Metals Analyst at HSBC, James Steel. James it’s been a fairly interesting ride for gold over the last couple of weeks. It fell to $1300 an ounce or there and thereabouts in fairly thin trade overnight. What’s been going on at the moment…why are we seeing this inability to move much higher than this?

JAMES STEEL: A couple of things have happened…one is that there’s been some relief on the geopolitical front, although tensions obviously remain in a number of spots around the world… it hasn’t perpetually driven gold higher and when these tensions even moderate, it begins to extract some of the safe haven bit out of gold. And in addition, we’ve had a little drop in the euro in the past… over a week now. It’s fallen and the dollar has been able to gain some ground and there’s still this long-lasting interest correlation between gold and the dollar and of the positive correlation between gold and the euro. Some of that is based on ideas that tapering will continue… and lastly I think the options exploration on the COMEX recently showed that the market mechanics still have an impact and that helped drag the market down to the $1300 level.

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