Gold Investment, Wait until corrected
Gold Investing October 4th, 2009
Demand for gold investment demand rose 96 percent to 122.7 tons. In 2008 the commodity price increase is estimated at more limited.
Gold prestige so fascinating. Beginning in January last week, the price has gone through USD872, 55 per troy once. New record for the last 28 years shows that during 2007 the price of the yellow has increased 38.2 percent.
Within the country, due to the increase of gold jewelry that transactions continue to slow. Understandably, 24-carat gold price in the range dibanderol now Rp256, 260 thousand per gram. In fact, in January last year the new price is Rp190 thousand per gram.
Vivi, a gold trader in the region Cikini, Central Jakarta, to express, to find a buyer it is difficult. When prices started creeping up in mid 2007, he said, there are still many consumers who make the sale. But, the condition is now rare.
“The day could do just one piece is good,” he admitted, was quoted as saying Saturday (19/1/2008). To get the filthy lucre, the traders are now dependent on the cost of washing jewelry. The fee of about Rp25 thousand per piece.
The question is, will the gold price would continue rising? Head of Research Recapital Poltak Hotradero, not too sure. He just saw the price of gold will be sloped. Therefore, global demand will diminish.
Poltak revealed, there are two factors that make this commodity prices rose sharply. First, demand from China and India growing very rapidly. Growing number of upper middle class citizens have been pushing gold demand increased.
The second factor related to the weakening United States currency. As is known, the movement of CAD is inversely proportional to the price of gold. For example in August last year. When the case began sticking subprime mortgage in the U.S., exchange rate USDterhadap world currencies, especially the Euro weakened. As a result, in September, gold has gone up seven per cent to as low as USD712, 63 per troy once.
Poltak rate, gold demand from China and India will diminish. Therefore, the price was too high. The impact, on demand in the market will tend to decrease. Because there are no other factors that would encourage increased demand. Pamor CAD is also expected to be better than last year.
Although the ripples subprime mortgage and oil prices could affect the fundamental American, but his condition was not believed to be getting worse.
Different views expressed Leo Hadi. According to Country Manager of World Gold Council (WGC), the American economy is now in a difficult position. On the one hand, to suppress inflation, they have to raise interest rates.
However, if it is the impact of subprime mortgage could come back bigger. Therefore, Leo sure, the Federal Reserve would cut rates to as low as 3.50 percent. When it was done, he said, USD will weaken. So that the potential increase in gold prices, although limited, re-open.
Throughout 2008, if the oil price is still below the level of USD 100 per barrel, gold prices are predicted to be in the range of USD750-850 per troy once.
Conversely, if oil kept going and passed the USD 100 per barrel, the price could penetrate USD900 per troy once. Because these energy price increases will encourage more parties to hedging. One of them by buying gold price is relatively more stable and rarely fall.
Based on data from WGC, until the quarter III-2007, world gold demand rose 19 percent to 947.2 tons. The need for investment rose 96 percent to 250.7 tons position. The gold for consumption only rose six percent to 590.7 tons.
Although the top position in Southeast Asia, Indonesia’s gold consumption is declining. If in the year 2006 amounted to 57 tons, until the end of 2007 estimated that only 50 tons.
For gold investors, Leo advises them to wait and see attitude. Current price to be disadvantageous for investment. According to Leo, investors should wait for the price-level corrected to USD750 per troy once.
