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April 11, 2013

Release Date: 
Thursday, April 11, 2013

Gold prices rose modestly on the New York Spot Market while silver remained flat. “Bargain hunters bought gold after bullion dropped 1.6 percent on Wednesday after minutes of the Federal Reserve's last policy meeting showed the U.S. central bank was inching closer to ending its monetary stimulus program. On charts, gold should benefit from technical buying as the metal is currently testing the bottom of a broad $1,790-$1,530 trading range over the past 18 months, said Ashmead Pringle, president of GreenHaven Continuous Commodity Index fund.” (“Gold rebounds from 1-week low as dollar slips,” Reuters, 4/11/13.) You can see the most current spot prices here.

Julian Jessop, the head of commodities research for Capital Economics, told clients that gold has “plenty of upside,” and affirmed his forecast of $2,000 per ounce. “Superficially at least, there has been a close relationship between the size of the US monetary base and the price of gold since 2008. Nonetheless, even if the Fed’s asset purchases are scaled back later this year, the US monetary base is still on course for around $3.5 trillion, which…at face value, would be consistent with a gold price of $2,000 per ounce. What’s more, other major central banks, including the Bank of Japan and the Bank of England, are set to ease further.” (“One Gold Bug Sticks to Bullish Views,” WSJ, 4/11/13.)

A Central Bank of Cyprus spokesperson denied reports the central bank would sell more than ½ billion dollars’ worth of gold reserves as part of its bailout. "The decision to sell the gold is a decision to be taken by the board of the Central Bank of Cyprus (CBC). No such thing has been discussed or is in the process of being discussed. There are so many rumors flying about and this is just one of them," the spokesperson told CNBC. (“Cyprus Central Bank Denies Plan to Sell Gold,” CNBC, 4/11/13.)

North Korea has nuclear weapons which can be delivered via ballistic missiles, a congressman stated during congressional hearings. The director of U.S. national intelligence testified North Korea’s “nuclear weapons and missile programs pose a serious threat to the United States and to the security environment in East Asia.” (“Congressman: N. Korea may be able to deliver nuke warhead,” CNN, 4/11/13.)

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†This material has been prepared for private use. Although the information in this commentary has been obtained from sources believed to be reliable, Goldline does not guarantee its accuracy and such information may be incomplete or condensed. The opinions expressed are subject to change without notice.

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