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Gold/Mining/Energy : Mining News of Note -- Ignore unavailable to you. Want to Upgrade?

To: LoneClone who wrote (2449)	6/12/2007 9:54:21 PM
From: LoneClone	Read Replies (1) \| Respond to of 194482

Despite corrections, outlook for gold, silver bullish while platinum ETFs attract investors mineweb.com Despite May’s partial price corrections, Canadian bullion firm ScotiaMocatta is still bullish overall on the gold outlook, and forecasts renewed fund interest in silver, and increased investor interest in platinum ETFs. Author: Dorothy Kosich Posted: Tuesday , 12 Jun 2007 RENO, NV - While the month of May generated a partial correction in precious metals prices, ScotiaMocatta maintains that the outlook for gold "still remains bullish overall, although the upside going may be that much tougher, especially over the summer months." Although silver also corrected in line for the pullback in gold, ScotiaMocatta--The Bank of Nova Scotia's bullion division--predicted that fund interest would pick up again in the precious metal. PGMs, which also followed gold, "have been surprisingly weak," according to the bullion firm, "are now well placed to recover." In their June 2007 "Metals Matters" analysis, ScotiaMocatta analysts said, "Numerous factors emerged during the month of May to weigh on prices that is probably why the dip ran as far as it did." Among the most bearish development for gold last month was a stronger dollar. Meanwhile, central bank gold sales have also picked up. "On top of that, investor interest in the gold ETFs has waned, with the total tonnage under management at the top five ETFs falling from 651.8 tonnes at the end of April to 635 tonnes at the end of May. The reversal in ETF interest was particularly noteworthy as, up until recently, any weakness in the gold price has tended to boost investment buying," the report said. Nevertheless, ScotiaMocatta has assured investors that "in the current market climate the need for safe-haven investments is unlikely to remain subdued for long." "Going forward, it looks as though interest across the commodities is picking up again and this should see a renewed interest in gold, especially as the fundamentals for the metal remain broadly supported. In addition, the dynamics of sovereign reserves seems to be changing and these could have fear-reaching implications for the dollar, all of which could be bullish for gold." SILVER Meanwhile ScotiaMocatta asserted that market fundaments for silver remain sound. However, the firm noted that the "volume of silver under management has slowed in recent months with the fund holdings around 4,250 tonnes of silver in early June, compared to 4,195 tonnes in early May." "Without strong growth in investment demand, there is a danger that silver will struggle to hold onto these gains," the analysis suggested. Nevertheless, ScotiaMocatta's analysts think commodities in general will see a new wave of buying. "We think silver will continue to attract strong investment demand as central banks, institutional and private investors diversify their portfolios." Any return to dollar weakness should also provide additional support, they suggested. PGMs ScotiaMocatta's analysis suggests that platinum is likely to record a surplus this year. "This seems to be un-nerving some investors. However, investors hold the key as to whether or not a surplus is indeed seen." If new platinum ETFs prove popular, investment buying could "easily soak up the surplus metal and could end up competing with the trade for their requirements too," ScotiaMocatta suggests. Their analysis determined that one ETF has accumulated more than 17,000 ounces of platinum since April, which although not a huge volume yet, could mean the difference between the market being in deficit or surplus." Although palladium remains in a supply surplus, ScotiaMocatta asserts that ongoing demand for palladium jewelry and an increase in order for Olympics memorabilia ahead of next year's games could increase demand this year. "Overall, the PGMs are likely to attract ongoing fund interest especially as their demand profiles remain robust. Palladium should benefit from substitution demand, while pent-up demand for jewelry should underpin platinum," the report concluded.