Commerzbank see gold rising on higher inflation expectations
(Kitco News) - Commerzbank commodities analyst DanielBriesemann noted that gold is being lent buoyancy by the risinginflation expectations, in his latest daily commodities report. He added that"market-based inflation expectations in the US temporarily reached anine-year high of almost 2.7% on Friday. The long-term inflation expectationsin the Eurozone (for five years in five years) exceeded the 2% mark for thefirst time in seven years. The markets are pricing higher inflation in more andmore, in other words, and many market participants clearly believe that thecurrent high level of inflation is no longer merely temporary."
When looking forward he said "Gold should profit from this inits role as a store of value. Gold also benefited on Friday from the fact thatthe technically important 100- and 200-day moving averages were exceeded, whichprobably sparked technical follow-up buying. ETF investors still appear to haveno confidence in gold and speculative financial investors have likewise notbeen betting significantly on rising gold prices of late, according to theCFTC's statistics. That said, they have expanded their net long positions insilver considerably, increasing them nearly four-fold to 19,400 contracts inthe week to 19 October."
When it comes to some other precious metals Briesemann noted "This also explains whysilver has noticeably outperformed gold in the period under review, drivingdown the gold/silver ratio. Speculative financial investors have become moreoptimistic about platinum, too: the CFTC statistics show that positioning hereis net long again for the first time in 13 weeks. The platinum price hasclimbed in absolute terms of late, but has not gained any ground vis-? -visgold. On the contrary, the price gap between the two precious metals haswidened again."
By Rajan DhallFor Kitco News
Follow rajfx10
rdhall@kitco.comwww.kitco.com