Over $4 trillion in world currencies is traded each day in forex markets, 16.5 times more than the trading volume of all global stock markets. Yet, only 2 percent of forex transactions correspond to actual economic activity. In other words, 98 percent of all forex trades are purely speculative.
Germany’s central bank will repatriate part of its $200 billion gold reserves stored in vaults in the United States and in France, according to reports by the German press.
According to Handelsblatt, a respected German publication, Germany’s central bank plans to retrieve some 1,500 tonnes of gold stored in the vaults of the Federal Reserve in New York as well as its 450 tonnes of gold with the Bank of France in Paris.
As is often true in times of economic instability, alternative investments appear more desirable and specifically, gold investment has caught the eyes of many people looking to preserve and increase their wealth. With many of the world’s largest economies struggling significantly for the past several years, people are seeking ways to safely invest money outside of traditional financial markets.
Gold is one of the most precious and expensive metals and is often used as a safe hard asset – an alternative investment to fiat currency. With that in mind, this infographic takes a look at global gold mines and deposits, and how they all rank up.
Days after news of the LIBOR scandal broke, a report commissioned by the G20 warns that oil prices could be rigged by traders as the current system of oil price reporting is “susceptible to manipulation or distortion.”
According to the report by the International Organisation of Securities Commission, an inquiry has revealed a “variety of issues” over the way oil spot market prices are determined and how it ultimately affects the “transparency and functioning of oil markets.”
Gold demand in China expanded to record levels in the first quarter of 2012, with total consumer demand in China surging 10 percent to reach a new high of 255.2 tonnes. According to a report by the World Gold Council, purchases related to the Chinese Lunar New Year stimulated growth, with commercial banks and retailers promoting commemorative gold products to mark the auspicious Year of the Dragon.
The dollar has been used as the reserve currency for years. However, with the latest yen-yuan currency accord, there has been industry speculation over the future and the role of the dollar.
Following Japan and China’s currency and trade pact, several commentaries have surfaced analyzing the currency outlook for 2012.
After reaching new highs in 2011, the price of gold has tumbled sharply, losing ground for the fifth consecutive trading session.
Gold has been up by more than 11 percent since the start of the year. However, as the euro plunged to 11-month lows against the U.S. dollar, gold, too, was unable to get much support amid a much stronger dollar had to settle lower for the fifth consecutive session.
Gold futures for February fell by $31.40, or 2 percent, to close at $1.564. According to Bloomberg data, it is the longest slide since October 2009.
Concerned that the soaring franc would jeopardize its export market, Switzerland’s central bank yesterday pegged the franc to the euro and said it was prepared to spend an “unlimited” amount to defend the Swiss currency. This move effectively devalues the franc and brings about new fears of a currency war.
The Swiss franc, long considered a haven in times of crisis, had surged against the euro and the dollar this year as investors fled turmoil in the markets. That raised concern that Swiss exporters will be priced out of the market.
China’s yuan hit a fresh high against the dollar late Friday after the central bank guided its currency upward for the third straight day, marking the yuan’s biggest weekly rise since it was essentially unpegged from the greenback last year.
