It wasn't but two weeks ago that our junior gold pundits were exclaiming how glorious it was to have competition for the NY COMEX paper metals being established in Shanghai. Independent from the Rothschild/Goldman bankers we were told. How grand! And a bad call by our junior gold rangers who know not of the reach of the International Banking Cartel.
Gotta hit those books boys.
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2011-09-27 08:35
THE Shanghai Gold Exchange yesterday raised margin requirements for gold forward contracts from 12 percent to 15 percent as the price of the metal dropped by the daily trading cap.
The bourse made the move to raise the margin requirement to cut the leverage and will widen the trading band to 12 percent from 9 percent starting today, it said in a statement on its website.
The price for immediate delivery of 99.95 percent purity gold, the benchmark cash contract, slumped 9 percent to close at 327.95 yuan a gram, and the price for forward trading of gold also shed 9 percent to 328.57 yuan, according to the bourse.
Bullion of 99.99 percent purity also tumbled 9 percent to close at 327.56 yuan, the bourse said.
Spot gold dropped to an 11-week low of US$1,534.49 an ounce on Friday, bringing losses so far this month to nearly 15 percent, the biggest decline since the financial crisis in October 2008.
Xu Ming, a gold trader at the Bank of China, said investors sold gold in a panic due to weak global economic prospects, causing distortions in the price.
He, however, suggested investors buy the metal now that the price has fallen, and projected the price may soar to US$2,100 to US$2,200 an ounce next year.
"Spot gold hit as high as US$1,920 an ounce this year while the lowest point was around US$1,400 an ounce, so the growth margin is much bigger than the margin of decline," Xu said.
Spot gold and silver tumbled globally yesterday following sharp declines on Friday as investors speculated European governments will struggle to contain the region's debt problems, putting at risk the global economic recovery.
Trading of silver forward contracts will be suspended tomorrow if the price drops by the daily limit of 15 percent today, the exchange said in a statement yesterday.
The bourse raised the trading band from 12 percent to 15 percent after the silver contract price fell by the daily limit for two consecutive sessions. Under the exchange's rules, if the price declines by the limit for three straight days, trading will be halted for one day to prevent risks.
The bourse made the move to raise the margin requirement to cut the leverage and will widen the trading band to 12 percent from 9 percent starting today, it said in a statement on its website.
The price for immediate delivery of 99.95 percent purity gold, the benchmark cash contract, slumped 9 percent to close at 327.95 yuan a gram, and the price for forward trading of gold also shed 9 percent to 328.57 yuan, according to the bourse.
Bullion of 99.99 percent purity also tumbled 9 percent to close at 327.56 yuan, the bourse said.
Spot gold dropped to an 11-week low of US$1,534.49 an ounce on Friday, bringing losses so far this month to nearly 15 percent, the biggest decline since the financial crisis in October 2008.
Xu Ming, a gold trader at the Bank of China, said investors sold gold in a panic due to weak global economic prospects, causing distortions in the price.
He, however, suggested investors buy the metal now that the price has fallen, and projected the price may soar to US$2,100 to US$2,200 an ounce next year.
"Spot gold hit as high as US$1,920 an ounce this year while the lowest point was around US$1,400 an ounce, so the growth margin is much bigger than the margin of decline," Xu said.
Spot gold and silver tumbled globally yesterday following sharp declines on Friday as investors speculated European governments will struggle to contain the region's debt problems, putting at risk the global economic recovery.
Trading of silver forward contracts will be suspended tomorrow if the price drops by the daily limit of 15 percent today, the exchange said in a statement yesterday.
The bourse raised the trading band from 12 percent to 15 percent after the silver contract price fell by the daily limit for two consecutive sessions. Under the exchange's rules, if the price declines by the limit for three straight days, trading will be halted for one day to prevent risks.
Source: Shanghai Daily
