Gold Rebounds After Manipulation

November 29, 2012 at 08:00

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Gold for immediate delivery rose in Singapore Thursday. The price dropped 1.3 percent yesterday, the biggest fall since Nov. 2,  in a manipulated raid by the bullion banks acting on behalf of the US government, the mainstream media meanwhile put the drop down to concern that a U.S. deal on the fiscal cliff won’t be agreed.

Holdings in exchange-traded products expanded to 2,615.89 metric tons yesterday, according to data. The Dollar Index was little changed today after fluctuating yesterday on the outlook for the $607 billion combination of tax increases and spending cuts that may be implemented in January should lawmakers fail to reach accord on the budget.

“We’re not seeing signs of any significant follow-through selling,” said Nick Trevethan, a senior commodities strategist at Australia & New Zealand Banking Group Ltd. in Singapore. “The factors supporting gold really haven’t gone away. You still have large amounts of liquidity in the system, you’re seeing central banks trying to support markets.”

Gold, little changed this month, has climbed 10 percent this year after central banks from the U.S. to Europe took more steps to boost growth, raising concern currencies may weaken. Gold rallied 70 percent as the Federal Reserve bought $2.3 trillion of debt in two rounds of quantitative easing from December 2008 through June 2011.

Republican House Speaker John Boehner said he is optimistic officials can “avert this crisis sooner rather than later.” Treasury Secretary Timothy F. Geithner meets today with congressional leaders to discuss tax increases and spending cuts