Asian markets spent the day mostly selling risk assets, following negative sentiment in US session as rumours circled about a cut in China’s required-reserve-ratio (RRR). This measure of a commercial bank’s reserve (placed at PBoC) over actual lending is now a tool to stabilize financial market. A cut would imply growing trouble in the economy.
Today’s higher CNY fix and assurance from State Administration of Foreign Exchange (SAFE) have not averted outflows, nor did a strong Non-Farm Payrolls data in the US Friday.
Gold price elevated above 1100 once more, in reserve to the rest of commodities. The safe haven asset gathers considerable buying interests amid current risk rout in Asia, thus will likely retain this level. Gold holdings by exchange-traded funds increased 0.8 percent during the week ended January 8, according to Bloomberg.
Wearing gold all over the body appears to be the kind of fad that appeals to a few politicians (names withheld) and very rich and spoilt brats.
Not because they can’t suffer the harsh aftermath of dangerous metals but because what they have is pure.
Have you ever developed an ugly scratch after wearing jewellery That itch or any other reaction could well be your body not responding well to the metals; this reactions can be fatal.
Take the case of a Canadian man who is reported to have died after gold-plating his testicles to celebrate winning more than a half a million dollars jackpot.
Justin Reiter from Alberta, Canada, is thought to have died from complications arising from a ruinous desire for golden balls.
Friends said Reiter drew inspiration from 2002 movie comedy Goldmember — a parody whose story line is about a criminal mastermind who colours his victims’ members in gold.
Autopsy would later reveal that Justin died from lead poisoning, the result of an earlier ‘celebration’ that involved painting his genitals with a lead-based paint before deciding to up the ante to gold.
Gold, according to Dr Eliud Monda, a Nairobi dermatologist based at International skin and medical clinic, is non-reactive to the human body.
“Pure gold is safe for use,” he says adding that, “Gold on the skin does not react with anything and therefore cannot cause irritation, itchiness, or any other allergic reactions.”
And since the metal is inert, doctors don’t expect any allergic reactions even when used on teeth.
The only time a patient will complain of allergy coming from gold products, says Monda, is when the gold is impure. And it should not be hard to know that those who sold you the gold robbed you. “After a while they start turning darker,” said Monda.
But there are metals which are dangerous and can cause serious allergic reactions, adds Eliud. Metal allergies present with vesicles, eczema blotches and plaques.
Lead and Mercury are among metals ranked high in danger scale.
Dr Kizito Lubano, a lecturer at the University of Nairobi medical school says that lead causes ill health; ranging from general body weakness to cancer causing properties.
“The problem is that many people come into contact with lead in their day to day lives but they don’t even know,” he says.
Long-term contact with lead eventually leads to high lead concentration in the blood; which is detrimental.
The man worked in HRD’s certification office, which determines the value of particular stones. The court heard how he issued fraudulent certificates for 119 gems during an 18-month period between 2010 and 2012. He was paid by three diamond dealers a fee of €200 for each one – a total of €23,800.
One dealer made sure that the stones came across the desk of the official for adjudication. He received 30% of the price difference between the lower certificate and the one issued – a total of €20,047. The other two dealers took €745,000 in total, according to the prosecutor’s calculations. All three sums are forfeited, the court ruled.
The three traders were sentenced to 30 months, half of it suspended, as well as a €30,000 in fines (in addition to the forfeiture) and a ban on trading, also suspended. One of the trader’s companies was fined €60,000.
Based on work by industry consultant Surbiton, the Australian gold industry is churning out about 9.2 million ounces of the yellow stuff on an annualised basis.
So when the Australian dollar gold price falls by $115 an ounce in the space of a month, as it has, it is bound to hurt. Over a full year it would represent a $1 billion revenue hit.
Investors have acted accordingly. After being the shining light in a mining market that can’t wait for 2015 to be over, gold equities have fallen about 20 per cent in the past month.
Gold got off to a quiet start to the week on Monday, struggling to recover from the previous session’s losses as investors worried over the timing of a US interest rate hike.
Spot gold was little changed at $1,146.70 an ounce by 0040 GMT.
The metal had dropped 0.7 percent on Friday after Federal Reserve chair Janet Yellen said the US central bank would begin to raise rates this year.
Among other precious metals, platinum steadied on Monday, after posting its biggest weekly drop since July on Friday.
Gold’s historical trend is downward due to the strengthening dollar, but it is especially complex this month due to several conflicting factors.
Fed inaction last week paved a positive path for gold and the price of the commodity rose.
The ECB meeting this week and speculation of potential action serves as a temporary setback, but I expect inaction from the ECB to allow gold to go higher.
Gold gains on the passing of the ECB meeting and then intensifying concern about a potential U.S. government shutdown at the start of October.
However, when the government shutdown crisis is resolved, investors will again sell gold lower on speculation about an October Fed action.
A golden path has just been paved for gold investors, but it is full of obstacles. The Federal Reserve’s decision to hold off on interest rate liftoff, with all indications pointing toward non-action at least until December and possibly longer, in my opinion, is highly supportive to gold. Gold would be poised to move higher as a result of the removal of the dollar block against it. But be careful betting on it at the start of this week, as anticipation of potential ECB action could set a short-term speed bump. I see hope in ECB action eventually finding letdown, and gold benefiting again from that and the intensifying concern about a potential government shutdown in the U.S. Thereafter, though, investors will begin propping up the dollar and penalizing gold on October Fed meeting worries. The next month, therefore, is a complex one for gold.