Poor Gold.

Author:Mbakwe, Tom
Position:Around Africa - Africa/World - Brief Article
 
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Recent remarks by leading metal dealers that the current global terrorist upheaval and the uncertainty in world stock markets were unlikely to lead to a gold surge in 2002, appear to support the claims made by the Gold Anti-Trust Action Group (GATA) that Western central banks and governments have been "manipulating" the gold market to the detriment of African and other producers (see NA, Dec).

A survey published by The Sunday Times (South Africa) on 19 November, showed that "only one in 10 dealers and refiners expect the price of gold to rise above $300" in the coming year.

At the time of going to press, gold was trading at $276 an ounce, and experts were predicting that the next three-month average would be $282, as against last year's 12-month average of $292.

"Majority of dealers," The Sunday Times survey said, "expect the price to trade within a $270 to $290 band in the next three months, and between $260 and $295 in the medium-to-long term... South African producers and gold investors are thus more likely to benefit from further rand weakness than from a major upturn in the international price of their metals."

"This," says Pusch Commey, NA's Durban correspondent, "confirms GATA chairman Bill Murphy's allegations that Western central banks and government officials have been manipulating the gold market. There is no reasonable explanation for the behaviour of the gold price."

According to The Sunday Times, "gold enthusiasts are disappointed by the metal's relatively muted reaction during the current global terrorist crisis."

"Several major events," the paper said, "should have propelled precious metals skywards. They [are] the 11 September attacks, the freezing of suspect laundered funds, counter-strikes by the US and UK, upheaval in the Middle East and Pakistan, the anthrax threat, massive monetary and fiscal easing, and low interest rates to counter the global economic downturn."

Gold jumped by $24 to $295 in the days following the 11 September attacks, but slid back to $276 when the US and UK...

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