Gold Traders Extend Bullish Call on European Debt Crisis – Bloomberg 06-29-12

Salient to Investors:

Mark O’Byrne at GoldCore says demand picked up in the last month, and sees no resolution to the Europe crisis in the short-term.

ETP holdings is within 0.1 percent of the record set in March.

Russia, Turkey, Ukraine and Kazakhstan expanded gold reserves by a combined 25 tons in May.

Edel Tully at UBS said physical demand in India remains very much muted after a weakening rupee boosted costs.

Marcus Grubb at the World Gold Council said slowing growth in consumer prices is difficult for all asset classes including gold.

Predictions:

Gold traders are bullish for a sixth week. Bloomberg poll shows 16 bulls, 10  bears, 5 neutrals. Investors added the most since November to gold-backed exchange-traded products. Hedge funds et al increased bullish bets for four consecutive weeks.

Morgan Stanley cut its 2012 forecast by 8.1 percent to $1,677, but says the 11-year bull market isn’t over as central banks continue to stimulate economies and there are negative real interest rates in the U.S.

Jeremy Baker at Vontobel Belvista Commodity Fund is finding some very attractive commodities in terms of absolute prices, but says we need concrete steps from the EU for commodities to trend higher.

Read the full article at http://www.bloomberg.com/news/2012-06-28/gold-traders-extend-bullish-streak-on-debt-crisis-commodities.html