Dejected gold and silver shine in the coming year!
Now, United States economy continued to recover, Russia mired in economic crisis bog, determine the future of Europe continues to loose monetary policy, China's economy faces downside risks, however, is unexpected, does not become a safe haven for good gold and silver, why is that? Historic spread eclipsed the bright light of gold and silver, no longer exciting?
Market there will always be accidents, accidents there are accidents, use this phrase used to describe the current global economic pattern of ice two days couldn't have been right. Now, United States economy continued to recover, Russia mired in economic crisis, bog, determine the future of Europe continues to loose monetary policy, China's economy faces downside risks, however, is unexpected, does not become a safe haven for good gold and silver, why is that? Historic spread eclipsed the bright light of gold and silver, no longer exciting?
I thought, that's not what happened!
United States economy continued to rebound
First of all, from the United States talked about the economic recovery. Typically, non-farm payrolls and the unemployment rate is a measure of United States two important indicators of economic recovery, in the past few months, strong growth in non-farm unemployment returned to pre-crisis levels.
In the early hours of 18, the Fed's rate meeting, fed officials believe the United States is very strong on the economy, the job market still has room to manoeuvre. And almost all the participating officials is expected in 2015 to start raising interest rates, which indicates a United States economic recovery, the dollar would regain world currency dominance. We had accurately forecast the dollar will open in June 18 article midterm rising trend, strengthening in the US dollar will continue in the future, it is a major bad news for gold and silver.
Russia mired in "mud lake"
Then we talk about Russia's problems. It was reported that United States President Barack Obama on Thursday (December 18) have signed a new Bill of sanctions on Russia, according to Russia's defence, energy and banking to implement a new round of sanctions, has edge of crisis Russia economic woes.
Obama says Russia to take measures to ease the Ukraine situation, United States will be ready to ease sanctions. The Decree does not mean the United States and Russia sanctions stance changes. Plummeting injury has also relied heavily on oil export earnings of Russia, the "bear" has been doing animal fighting since June this year, international oil prices nearing 50%, Brent oil prices have now fallen below $ 60 a barrel.
The fall in oil prices is just a superficial phenomenon, is important to have some profound effects on economies, such as trade, particularly because of asset deflation, demand will decline. As regards the financial aspects, to Russia, the Middle East and other oil-producing countries are concerned, there are many other economies on its financial exposure is, Russia risks, like debt, Western Europe also hit at a financial level.
More important is the impact of falling oil prices on the economies of the world's main sovereign wealth Fund, the local currency fell when, must sell their foreign assets to raise funds to defend its currency, from this perspective, many stock market selloff occurs because the sovereign funds start to sell assets.
Joined Western sanctions, Russia will not sit still, Russia Duma (lower House of Parliament) last Friday (December 19) adoption of a draft law, agreed to provide the banking industry up to 1 trillion rubles (about US $ 16.5 billion) Fund to address Western economic sanctions. In addition, according to the market rumors, Russia is selling gold reserves, stabilize the financial problems.
According to IMF data, a large oil-producing 115 tonnes of gold were purchased in January-September, and in October increased 18.9 tons of reserves. Russia this year to accelerate buying gold for future tensions with the West and economic downturn be prepared. Now, Russia's Central Bank is likely to sell part of its gold reserves in December. United States financial blog, Zerohedge quoted some media said, in the first week of December, Russia official gold reserves fell by $ 4.3 billion.
If in the future the rumours, it will cause the price of gold fell sharply, thus spurring silver falls.
Europe's future continued easy monetary
Reportedly the fastest European central banker Mario Draghi may at a discussion meeting held on January 22 next year for large-scale asset purchase (that is, full quantitative easing) option. Although this initiative may gain the support of a majority of the members, but the European Central Bank hopes that a strong consensus on the controversial issue. ECB has not in the past agree but a decision by precedent.
We expect the European version of the QE is going to fully come, that the euro will continue to fall, indirectly pushing up the dollar price, gold and silver formed bad again.
Downside risk in China
Bureau of statistics of China, third quarter of the year, the domestic GDP grew 7.3%, the growth rate hit a near six-year low, GDP growth in the first three quarters of 7.4%, still lower than this year's official growth target for the year. If they failed to rebound in the last quarter this year may be the first time since 1999 economic growth target could not be achieved, annual economic growth reached a 24-year low.
December 12, China's Central Bank is expected to report on the work of the Research Council, 7.4% economic growth this year, was the slowest year in 1990 years, lowering it to 7.1% next year. June Ma, Chief Economist of the Central Bank's Research Bureau predicted led team believes that the main downside pressure is investment in real estate development slowed down.
Recently-concluded central economic work conference communiqué follows the last tone – "active" fiscal and "prudent" monetary, but also puts forward "proactive fiscal policy, monetary policy should focus more on the elasticity moderate." Is not difficult to see from wording, downside risks of the economy of China, growth has become a central work of the most important.
Above, the United States is speeding up the recovery of the economy, China's economic growth is slowing, and Russia economy is suffering a severe winter, while the European version full QE is to be put on. Faced with such a world of ice and fire two days, gold and silver is a layer-by-layer current pressure, especially at the dollar alone, are sought after in the market, surging background, gold and silver can retreat. However, I expect this trend to be reversed, our 2015 has become more optimistic about the prospects for gold. The main reason is, in my opinion, bullish dollar sentiment in the second half of 2015 is expected to subside. Also, once the United States started to raise interest rates, price pressures will be reduced, as the case in 2004 and 2006 when the Fed raised interest rates. Below is the trend of gold from 2004 to 2006 period.