Gold price remains strong at 936 level in European morning. Seeing the Fed's asset buying program likely cause inflation in the medium- to long-term, investors are pouring funds to gold and other precious metals, particularly in forms of ETFs. Assets in the SPDR Gold Trust climbed 1.4% to a record 1 084.33 metric tons yesterday.
Among other precious metals, silver also rebounds to 12.84 after plummeting to 11.89 yesterday( -5.8%). Silver's performance has outperformed that of gold since 2009. Year-to-date, silver price has risen 12% while gold gained 5%. Compared with 10% in gold, investment demand contributed only 7% to total demand in silver. Although we saw robust increase in ETF and COMEX futures/options in silver since collapse of Lehmann brothers, the growth still lacks that of gold.
Look at the Commitment of Traders' report from CFTC, net speculative long positions for gold have surged 60% to 144 788 as of Mat 10 since mid-September. During the same period, net long for silver rose only by 19% to 25 282. However, we did see silver investment catching up in 2009 with 28% gain in net long position year-to-date, compared with a 15% rise for gold futures. Concerning, ETFs, investment in silver ETF rose approximately by 7% since the beginning of 2009, more than that 3 times less than over 20% growth in gold ETF investments.
Crude oil price resumes yesterday's rally after mild consolidation around $49/bbl. In European morning, the benchmark contract breaks 50 level again and we expects this rise will lead crude oil price to 60 if it can close above 50.47.
Natural gas for April delivery remains weak Thursday after plunging 3.4% to settle at 6-year low of 3.684 yesterday. In the US, weather has got warmer and this reduced consumption driven by heating needs. According to the Fed's report Monday, Industrial production plunged -1.4% mom February, worse than market expectation of a -1.2% decline. Capacity utilization also slid to 70.09% from 72% in the previous month. Deterioration in industrial demand and power generation will further drag down natural gas price in coming months.
The US Energy Department will like report a 22 bcf decline in natural gas storage for the week ended Mar 13, significantly higher than the 85 bcf draw recorded the same period.