Kaloti Precious Metals-Morning Market Report-Wednesday, November 23, 2016

Market Daily & Weekly

Note: Indications only, open and closing prices are bids; Data source: Bloomberg; Times as per Dubai

Fundamentals and News

Gold Holdings Decline for Eighth Day as Fed Rate Increase Looms

• Investors cut holdings in gold exchange-traded products for an eighth consecutive session, the longest run in almost a year, amid speculation that the Federal Reserve will raise U.S. interest rates next month.

• Assets fell 9.43 metric tons to 1,923.1 tons Monday, the lowest since July, data compiled by Bloomberg show. Gold futures swung between gains and losses on Tuesday and are heading for the biggest monthly decline since May.

• The metal has slumped in the past two weeks as President-elect Donald Trump’s pledge to boost infrastructure spending bolstered the outlook for growth. Minutes of the U.S. central bank’s November policy meeting due on Wednesday are likely to confirm that officials were creeping closer to an interest-rate increase. Higher rates reduce the appeal of owning gold because it doesn’t pay interest.

• “We’ve had record withdrawals from gold ETFs,” Peter Thomas, a senior vice president at Zaner Group LLC in Chicago, said in a telephone interview. “We’ve already priced in the probability of next month’s rate increase.”

• Gold futures for December delivery rose 0.1 percent to settle at $1,211.20 an ounce at 1:46 p.m. on the Comex in New York. The price is still up 14 percent for the year after the best first-half performance in almost four decades.

• In other precious metals:

• European Union officials have announced a plan to restrict the trade of gold and other minerals used to finance armed conflicts.

• An agreement reached Tuesday would require importers of gold, tin, tungsten and tantalum from anywhere in the world to verify that their suppliers meet EU standards starting in 2021.

• EU trade commissioner Cecilia Malmstrom said the proposed rules are aimed at stopping "human rights abuses and armed conflict financed by trade in minerals" and expressed hope that other countries would follow suit. The U.S. passed similar legislation in 2010.

• Rights group Global Witness cautiously welcomed the deal but criticized loopholes and exemptions.

• The plan, negotiated by European lawmakers and European Commission officials, will go to the European Parliament and EU leaders for final approval.

Data Forthcoming Releases

Courtesy: http://kalotipm.com.sg/kaloti-market-report-23rd-november-2016