Mon Nov 16, 7:05 am ET
LONDON (AFP) – The dollar fell on Monday as China accused the United States of increasing protectionism and following unexpectedly strong Japanese economic growth figures, pushing gold prices to a record high point.
US President Barack Obama is in China for a three-day mission aimed at convincing Beijing that Washington is its partner, not its rival.
As the dollar dropped against the euro and yen, gold struck an all-time peak of 1,133.20 dollars an ounce.
In late morning trading here, the euro climbed to 1.4969 dollars from 1.4918 dollars late in New York on Friday.
Against the Japanese currency, the dollar fell to 89.42 yen from 89.66 yen late on Friday.
"Far better than expected Japanese third-quarter GDP data...spurred risk appetite," said Jane Foley, an analyst for online trading firm Forex.com.
"This pushed the euro close to 1.50 dollars in early European hours."
Japan's gross domestic product (GDP) grew 1.2 percent in the third quarter of 2009 from the previous quarter -- the fastest pace in two-and-a-half years and much better than expected, the government reported.
The euro also gained as higher commodity prices, driven by hopes of a global economic recovery, spurred investor risk appetite, market watchers said.
"Gains in gold prices lifted demand for currencies of commodities-exporting nations like the Aussie against the US dollar," Osao Iizuka, chief foreign exchange trader at the Sumitomo Trust and Banking Co, told Dow Jones Newswires.
"Then the selling of the US dollar spread across other currencies, causing the euro to gain ground," he said.
Comments from a Chinese commerce ministry spokesman accusing the US of protectionism earned a quick rebuttal from senior US officials speaking in Beijing, who said a trade war was in neither country's best interests.
"We used to see that the United States was an innovation-driven US. But what we are seeing now is an increasingly protective US," commerce ministry spokesman Yao Jian told reporters at a regular monthly briefing.
"It is necessary to create for enterprises a stable and predictable environment, including (stable) economic and foreign exchange policies, to help the global economy grow steadily and China's exports recover," he said.
Yao added that the United States had "continued" to let the dollar drop "to improve its competitiveness" while pressing for the yuan's appreciation.
"It is detrimental to the global recovery and is unfair for (the US) to require other (currencies) to rise while allowing the dollar to keep slumping," Yao told reporters.
But US Commerce Secretary Gary Locke said Washington was not at fault.
"The United States is not engaged in increased protectionism," Locke told a luncheon in Beijing.
Obama is expected to raise trade tensions with his counterpart Hu Jintao and also urge China to reconsider the value of the yuan, which has been effectively pegged to the dollar since July 2008 and is deemed by Washington as being kept artificially low to boost Chinese exports.
In London on Monday, the euro was changing hands at 1.4969 dollars against 1.4918 dollars late on Friday, at 133.85 yen (133.57), 0.8966 pounds (0.8937) and 1.5096 Swiss francs (1.5093).
The dollar stood at 89.42 yen (89.66) and 1.0085 Swiss francs (1.0117).
The pound was at 1.6695 dollars (1.6693).
On the London Bullion Market, the price of gold jumped to 1,131.70 dollars an ounce from 1,104 dollars an ounce late on Friday.
Showing posts with label gold reserves. Show all posts
Showing posts with label gold reserves. Show all posts
Monday, November 16, 2009
Thursday, September 3, 2009
Hong Kong Recalls Gold Reserves in London
HONG KONG (MarketWatch) -- Hong Kong is pulling all its physical gold holdings from depositories in London, transferring them to a high-security depository newly built at the city's airport, in a move that won praise from local traders Thursday.
The facility, industry professionals said, would support Hong Kong's emergence as a Swiss-style trading hub for bullion and would lessen London's status as a key settlement-and-storage center.
"Having a central government-sponsored vault would create a situation where you could conceivably look at Hong Kong as being a hub, where metal could be traded for the region," said Sunil Kashyap, managing director at Scotia Capital in Hong Kong, adding that the facility was the first with official government backing in the region.
The Hong Kong Monetary Authority, which functions as the territory's unofficial central bank, will transfer its gold reserves stored in other vaults to the depository later this year, the Hong Kong government said in an earlier statement.
The monetary authority reported $63 million in physical gold reserves as of July 31, according to its International Reserves and Foreign Currency Liquidity statement. The authority wouldn't disclose where the reserves are held, but local media reports cited gold traders as saying that London's the most likely location.
Traders said the new depository facility could also foster new financial products, such as exchange-traded funds based on precious metals.
The 3,660-square-foot depository, located at the city's main Chek Lap Kok Airport, will serve as a "storage facility for local and overseas government institutions," according to the government statement.
Martin Hennecke, a financial advisor with the Hong Kong-based Tyche Group Ltd., said that could be appealing to regional central banks unnerved after watching the global financial system teeter on verge of implosion last year.
"Central banks are increasingly aware of the importance of having gold reserves at time of financial crisis and having it easily available at their own disposal," he said.
Meanwhile, local newspaper reports said the Hong Kong Mercantile Exchange had signed an agreement to use the depository for its physical settlement and storage needs.
Marketing efforts will be launched to convince Asian central banks to transfer their gold reserves to the Hong Kong facility, according to reports citing Raymond Lai, finance director with the Hong Kong Airport Authority.
Efforts will also be made to reach out to commodity exchanges, banks, precious-metals refiners and ETF providers, the reports said.
Management firm Value Partners planned to launch an ETF gold fund that will use Hong Kong instead of London as a repository for the gold backing the fund, local reports said Thursday.
The facility, industry professionals said, would support Hong Kong's emergence as a Swiss-style trading hub for bullion and would lessen London's status as a key settlement-and-storage center.
"Having a central government-sponsored vault would create a situation where you could conceivably look at Hong Kong as being a hub, where metal could be traded for the region," said Sunil Kashyap, managing director at Scotia Capital in Hong Kong, adding that the facility was the first with official government backing in the region.
The Hong Kong Monetary Authority, which functions as the territory's unofficial central bank, will transfer its gold reserves stored in other vaults to the depository later this year, the Hong Kong government said in an earlier statement.
The monetary authority reported $63 million in physical gold reserves as of July 31, according to its International Reserves and Foreign Currency Liquidity statement. The authority wouldn't disclose where the reserves are held, but local media reports cited gold traders as saying that London's the most likely location.
Traders said the new depository facility could also foster new financial products, such as exchange-traded funds based on precious metals.
The 3,660-square-foot depository, located at the city's main Chek Lap Kok Airport, will serve as a "storage facility for local and overseas government institutions," according to the government statement.
Martin Hennecke, a financial advisor with the Hong Kong-based Tyche Group Ltd., said that could be appealing to regional central banks unnerved after watching the global financial system teeter on verge of implosion last year.
"Central banks are increasingly aware of the importance of having gold reserves at time of financial crisis and having it easily available at their own disposal," he said.
Meanwhile, local newspaper reports said the Hong Kong Mercantile Exchange had signed an agreement to use the depository for its physical settlement and storage needs.
Marketing efforts will be launched to convince Asian central banks to transfer their gold reserves to the Hong Kong facility, according to reports citing Raymond Lai, finance director with the Hong Kong Airport Authority.
Efforts will also be made to reach out to commodity exchanges, banks, precious-metals refiners and ETF providers, the reports said.
Management firm Value Partners planned to launch an ETF gold fund that will use Hong Kong instead of London as a repository for the gold backing the fund, local reports said Thursday.
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