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Mid-Session Gold Market Report for 11/18/2008

Gold has seen a choppy two sided trade this session, but the market has recovered off the lows and has managed to move back into positive price territory ahead of mid-session. So far the gold market has stayed within Monday's range, but the strength on other metals markets are now giving gold an upward more of an upward bias. Gold was initially weighed down by continued deleveraging in commodities as global stock markets weakened overnight and the Dollar firmed on safe haven buying. Gold was pushed to session lows in reaction to the US Producer Price Index data which fell 2.8% in October as the deflationary environment and recessionary economic conditions seemed to inspire selling. But investor selling interest in the gold market seemed to dry up quickly on the early price dip. In fact, gold seemed to be lifted from session lows by a turn higher in US equity markets and strength in the other precious metals. It seems as if the gold market is getting some residual support from a recovery in platinum prices which rose on news that the world's third largest producer has announced mine closures raising concerns over supplies. Reports that the wedding season in India which begins this month is seeing good gold demand may also be underpinning gold prices.




 
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