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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: PaulM who wrote (5113)	1/2/1998 8:34:00 PM
From: goldsnow	Read Replies (1) \| Respond to of 116752

>>>worth repeating that...for every buyer, a seller. >> Paul, that is not necessarily true in general and is different in Gold where for every seller there are many small buyers and for every buyer there are many sellers. The trick to know who is selling (only CB's are of of interest..that is bring us to this.. Did you notice that seniors (PDG, NEM even ABX )and many juniors are under accumulation trend.. I hate to predict or make an appearance of predicting short trend, especially after tax-sell season conclusion, but.. Either somebody buying shares back hedging by buying mining shares or we would see POG to rally.. Next two weeks will tell.. Separatly, (many, many buyers) FOCUS-Low prices help fuel Indian gold demand 09:23 a.m. Jan 02, 1998 Eastern By Sambit Mohanty NEW DELHI, Jan 2 (Reuters) - Liberalised import rules and low world prices will sharply boost India's demand for gold in the new year, a senior official of the state-run Minerals and Metals Trading Corp (MMTC) said on Friday. The official, who asked not to be identified, told Reuters domestic gold consumption was expected to rise sharply to 700 tonnes in 1998 from 500 tonnes in 1997. ''We feel that the demand may go up to 700 tonnes in 1998,'' the official said. ''This estimate is on the conservative side.'' ''There has been a sudden spurt in gold demand in the country in the last two months,'' he said. ''This trend will continue. Gold consumption will rise in all sectors -- urban, semi-urban and rural.'' India liberalised gold import rules in 1997 by authorising eight banks to import gold and sell in the domestic market in addition to the three state-run agencies -- the State Trading Corp (STC), MMTC and the Handicrafts and Handloom Export Corp of India. The official said the inflow of gold had risen sharply after imports were liberalised, pushing down local retail prices. ''Gold prices in the domestic market are expected to remain between 4,000-4,200 rupees per 10 grams in 1998,'' he said. A year ago it was trading at about 5,000 rupees per 10 grams. 24-carat gold was quoted at about 3,980 rupees ($101) per 10 grams in the Bombay markets on Friday. ''We are looking for imports mainly from the Swiss banks,'' the official said. ''We will also be looking for gold from other sources.'' He said gold smuggling would also fall as the metal was now easily available at lower prices. ''It is estimated that inflow of smuggled gold will fall to say 100 tonnes in 1998 from about 115 in 1997.'' He said domestic gold prices were currently only seven percent higher than global prices. Gold cost about 17 percent more before the import rules were liberalised. ''Right now, our expenses to import gold come to about six percent,'' the official said. ''Therefore, Indian domestic prices have to be at least six percent higher than world prices. Below that, it won't be profitable.'' The official said gold prices had remained at lower levels in 1997 despite an increase in demand, and it was therefore difficult to predict world price movements in 1998. ''There has been a sudden spurt in demand from the Southeast Asian nations and the Middle East,'' he said. ''But surprisingly, global gold prices had not risen to the same extent. Therefore, price movements are anybody's guess.'' India is the world's largest consumer of gold, although nearly a third of its more than 900 million people live below the poverty line, with an average per-capita income at around $330 a year. The country's main demand is gold jewellery, given and used each year at an estimated 10 million weddings, which absorbs about 60 percent of the precious metal. ($1-39.3 rupees) Copyright 1997 Reuters Limited. All rights reserved.