GOLD PRICE NEWS - The gold price closed roughly unchanged near $1,167 on Thursday as the price of gold remained in standby mode ahead of an expected announcement this weekend on the Greek bailout. After reaching a new 2010 high this past Tuesday, the gold pricehas held the majority of its gains from earlier in the week.
As has been the case in recent weeks, the gold price moved in the same direction as the U.S. dollar - in contrast to its historically strong inverse correlation. The gold price declined to a low of $1,162 Thursday morning but recovered most of its losses this afternoon, while the U.S. Dollar Index finished lower by 0.4% at 82.03. With the sovereign debt concerns in Greece, Spain, and Portugal pressuring the euro currency earlier this week, investments tied to the price of gold have been accumulated along with the dollar as safe haven asset classes.
Cyclical commodities rallied alongside the broader stock market, benefitting from the declining U.S. dollar. The price of silver, oil, and platinum posted gains of 2.4%, 2.3%, and 1.2%, respectively. The price of copper was an outlier, as it slid 1.1% to $3.35 per pound following news that Chile - the world’s largest copper-producing nation - reported that output of the industrial metal rose 5.0% to 461,127 tonnes in March. The increase came despite a large earthquake on February 27 that left hundreds of people dead and caused production bottlenecks for many of Chile’s other leading industries.
Gold mining stocks posted a strong week as strong first quarter earnings reports from several of the world’s largest gold mining companies, notably Newmont Mining (NEM) and Barrick Gold (ABX), buoyed the sector.Goldcorp (GG) announced their earnings report after the bell yesterday, and while the Canadian-based gold producer missed analyst estimates, it did reaffirm its full-year 2010 gold production and cash costs forecast.
In an interview on CNBC this afternoon, CEO Chuck Jeannes discussed the company’s results and offered his outlook for the gold price and gold mining sector. When asked about the forces driving the price of gold higher in recent years, Mr. Jeannes responded that gold demand has been almost entirely on the investment side. However, looking ahead he predicted that jewelry demand from India and China will begin to contribute more so to the equation.
As for Goldcorp’s view on where the price of gold may be headed in the coming years, Jeannes did not provide a specific gold price target, but did note that the company looks at long-term supply and demand issues. Given the fact that gold mine supply has been contracting on a worldwide basis for several years, according to Jeannes, and that demand has continued to rise, he suggested that there is further room for the price of gold on the upside.
http://www.goldalert.com/stories/Gold-Price-Steady-Near-2010-High
