Gold Gains As 14% Plunge Overdone – Speculators Sell, Central Banks To Buy
By Mark O’Byrne
16 April 2013
Gold rebounded as store of value and diversificaiton buyers deemed a 14% plunge over two days to be excessive and an Asian central banker said that policy makers may take the opportunity to buy.
Silver, platinum and palladium also advanced. At 11.30am GMT silver is 23.44(+0.75), platinum is $1,438.00(+39.00) and palladium is $677.00(+26.00).
Prices fell 9.1% yesterday, the most since 1983, and have lost 28% since reaching a record in September 2011.
Banks such as Soc Gen and Commerzbank have admitted that the sell was ovedone.
Societe Generale SA said that the slump was overdone as quantitative easing, or QE, will continue.
“Everything isn’t looking that rosy, so gold should hold up,” said David Poh, Singapore-based regional head of portfolio-management solutions at Societe Generale Private Banking. “This tumbling over the past few days is overdone. We think a good time to accumulate is at the $1,300 level.”
The decline in prices would give central banks an opportunity to buy, Central Bank of Sri Lanka Governor Ajith Nivard Cabraal said in an interview on Bloomberg Television today.