New fleet of 76 public transport buses starts operation in Jeddah on Tuesday Environmentally friendly electric buses introduced for first time    Foreign investors are allowed to engage in real estate business outside Makkah and Madinah Commercial speculation should not be the purpose of real estate transaction    EU preparing 'further countermeasures' to protect its interest, von der Leyen says    Saudi Arabia urges stronger global action to protect children in cyberspace at UN    Musk's X is suing India, as Tesla and Starlink plan entry    Tesla sales plunge after backlash against Elon Musk    Saudi Arabia posts SR49.8 billion travel surplus in 2024 as visitor spending hits SR153.6 billion    911 emergency centers handle over 2.8 million calls in March    Israel announces expansion of military operation in Gaza to seize 'large areas' of land    US cancels visa of Nobel Peace Prize winner Oscar Arias    Danish prime minister refutes US claim on Greenland on visit to the Arctic territory    Aubameyang fires Al Qadsiah into King's Cup final with stoppage-time winner over Al Raed    Cristiano Ronaldo joins Fatal Fury: City of the Wolves    Saudi Arabia welcomes trilateral border treaty between Tajikistan, Kyrgyzstan, and Uzbekistan    Swedish table tennis legend Jörgen Persson appointed head coach of Saudi national team    Danilo Pereira fires Al Ittihad into King's Cup final with dramatic stoppage-time double    Screen time in bed linked to insomnia, study finds    Mexico bans junk food in schools to fight childhood obesity epidemic    Sweet sales surge ahead of Eid as Saudi chocolate imports top 123 million kg in 2024    Saudi creatives shine at Jeddah's Fawanees Nights with art, fashion, and storytelling    Bollywood actress vindicated over boyfriend's death after media hounding    Grand Mufti rules against posting prayers and preaching in mosques on social media    King Salman prays for peace and stability for Palestinians in Ramadan message King reaffirms Saudi Arabia's commitment to serving the Two Holy Mosques and pilgrims    Bollywood star Saif Ali Khan 'out of danger' after attack at home in Mumbai    Exotic Taif Roses Simulation Performed at Taif Rose Festival    Asian shares mixed Tuesday    Weather Forecast for Tuesday    Saudi Tourism Authority Participates in Arabian Travel Market Exhibition in Dubai    Minister of Industry Announces 50 Investment Opportunities Worth over SAR 96 Billion in Machinery, Equipment Sector    HRH Crown Prince Offers Condolences to Crown Prince of Kuwait on Death of Sheikh Fawaz Salman Abdullah Al-Ali Al-Malek Al-Sabah    HRH Crown Prince Congratulates Santiago Peña on Winning Presidential Election in Paraguay    SDAIA Launches 1st Phase of 'Elevate Program' to Train 1,000 Women on Data, AI    41 Saudi Citizens and 171 Others from Brotherly and Friendly Countries Arrive in Saudi Arabia from Sudan    Saudi Arabia Hosts 1st Meeting of Arab Authorities Controlling Medicines    General Directorate of Narcotics Control Foils Attempt to Smuggle over 5 Million Amphetamine Pills    NAVI Javelins Crowned as Champions of Women's Counter-Strike: Global Offensive (CS:GO) Competitions    Saudi Karate Team Wins Four Medals in World Youth League Championship    Third Edition of FIFA Forward Program Kicks off in Riyadh    Evacuated from Sudan, 187 Nationals from Several Countries Arrive in Jeddah    SPA Documents Thajjud Prayer at Prophet's Mosque in Madinah    SFDA Recommends to Test Blood Sugar at Home Two or Three Hours after Meals    SFDA Offers Various Recommendations for Safe Food Frying    SFDA Provides Five Tips for Using Home Blood Pressure Monitor    SFDA: Instant Soup Contains Large Amounts of Salt    Mawani: New shipping service to connect Jubail Commercial Port to 11 global ports    Custodian of the Two Holy Mosques Delivers Speech to Pilgrims, Citizens, Residents and Muslims around the World    Sheikh Al-Issa in Arafah's Sermon: Allaah Blessed You by Making It Easy for You to Carry out This Obligation. Thus, Ensure Following the Guidance of Your Prophet    Custodian of the Two Holy Mosques addresses citizens and all Muslims on the occasion of the Holy month of Ramadan    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



Gold to outshine other commodities
Published in The Saudi Gazette on 26 - 10 - 2012

LONDON – Gold may outperform other commodities as the bull run in raw materials pauses amid slowing economies, while grains and oilseeds may jump on weather disruptions, participants at the 8th annual World Commodities Week conference said.
Gold is up 9.7 percent this year and traded at $1,715.53 an ounce by 4:10 p.m. in London. Central banks have been expanding gold reserves after the metal climbed the past 11 years and investors boosted holdings in bullion-backed exchange-traded products to a record. Countries bought 254.2 tons in the first half of 2012 and may add close to 500 tons for the year as a whole, the London-based World Gold Council said in August.
Commodities will likely lack direction for the next 12 months, meaning investors will focus more on relative-value trades, according to Tiberius Asset Management AG. Deutsche Bank AG favors precious metals and is neutral on oil and industrial metals, Michael Lewis, head of commodities research at the bank, said Thursday. Bullion isn't in a “bubble” at current prices, he said.
“The markets will go sideways in a volatile environment” in the short term, said Christoph Eibl, a founding partner of Zug, Switzerland-based Tiberius. Commodities erased their gains for the year on Oct. 23 on concern demand for energy, industrial metals and some agricultural products will slump as economic growth decelerates. Raw materials, as measured by the Standard & Poor's GSCI Index of 24 commodities, made annual advances in 11 of the last 13 years. The gauge's last annual drop was in 2008.
Commodity assets under management reached $423 billion at the end of August, from $395 billion at the start of the year, based on Barclays Plc's estimates of money tied to exchange- traded products, medium-term notes and indexes, according to an Oct. 1 report. Assets reached a record $451 billion in April 2011.
About $50 billion of investments is tracking commodity indexes other than the two biggest, the S&P GSCI and the Dow Jones-UBS Commodity Index, according to Dan Raab, head of commodity investor marketing and structuring at UBS Securities LLC.
“Commodities as an asset class absolutely can't be ignored,” Raab said. “Consumption of raw materials and use of commodities is likely to increase in the next 20 to 30 years.”
The International Monetary Fund cut its 2012 global growth forecast to 3.3 percent on Oct. 9, compared with a July prediction of 3.5 percent, and expects the euro area to contract 0.4 percent. Growth in China, the biggest user of everything from copper to cotton, has slowed for seven consecutive quarters.
The S&P GSCI gauge is down 1.2 percent this year and the MSCI All-Country World Index of equities gained 10 percent. The US Dollar Index, a measure against six major trading partners, fell 0.3 percent.
Gold won't become a bubble unless prices rise to a record above $2,200 an ounce, while oil and industrial metals are vulnerable to risks associated with the so-called fiscal cliff in the US, said Lewis of Frankfurt-based Deutsche Bank. He was referring to $607 billion in federal spending cuts and tax increases scheduled to take effect in January unless the U.S. Congress intervenes.
The US Federal Reserve said Sept. 13 it will buy $40 billion of mortgage debt a month in the third round of so-called quantitative easing and probably hold the federal funds rate near zero until at least the middle of 2015. Gold prices almost doubled from December 2008 to June 2011 as the central bank bought $2.3 trillion of debt in two rounds of QE.
“Precarious” inventory levels in some agricultural products, such as soybeans and corn, mean there is little room in the market to absorb any supply shocks, Lewis said. Rising inflation related to food prices may prevent emerging markets countries from introducing more easing measures that could have boosted demand for other raw materials, he said.
“The hardest area to play in commodities is agriculture,” said Chris Armitage, the UK managing director at FourWinds Capital Management, which oversees about $1 billion in natural- resource funds.
The US Department of Agriculture estimated in June that the US would harvest a record 14.79 billion bushels of corn, before slashing its forecast to 10.7 billion bushels, following the worst drought in half a century. Wheat has rallied 36 percent in Chicago this year, while soybeans are up 30 percent and corn has gained 17 percent. – Agencies


Clic here to read the story from its source.