Gold News

Asian gold sees best and worst of US crisis

Reports this morning showed that Asian gold markets were struggling under the weight of US economic problems, while certain markets were bucking the trend.

Amid overall losses of 1.7 per cent for the Morgan Stanley Capital International Asia-Pacific Index, gold bullion for immediate delivery today (September 10th) fell $1.31, to slip below the $700 mark.

The figures from the Singapore-based index are reported by Bloomberg to indicate a gold sell-off in response to US job losses of 4,000, as Asian investors take advantage of a strong gold price to sell immediately and cover losses incurred elsewhere.

Japanese gold buying seemed, however, to be forging a different path. A stronger yen against the dollar coupled with increased confidence in the precious metal after the Friday surge over $700 created a burst of gold investment in Tokyo, said Reuters.

The firm yen value encouraged selling of Tokyo bullion futures, but proceeds were reportedly used to fund buying of spot gold, helping to keep the gold price near to the $707 per ounce high achieved on Friday.

So with problems in the US housing market appearing to further extend their impact, Asian gold investment is on one hand being buoyed by the strength of the safe-haven metal and on the other showing willingness to sell in response to other losses.

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