US Gold and Silver prices have weakened following the announcement by US President Obama that the lawmakers have reached a deal to raise the nation's debt limit and cut the federal deficit to avert default of payments on August 2.
Gold prices have weakened from a record high of $1632 hit on July 29 to $1607 while cash silver prices have dropped to $39.315 in Singapore, Bloomberg reported.
Silver net-long positions have risen by 11 percent to 27,492 contracts thanks to increased interest in the metal from hedge funds and other money managers., according to data till July 26 released by US markets regulator, Commodity Futures Trading Commission (CFTC).
Furthermore, new money in gold-backed exchange traded funds has surged over the last month. according to ETF Securities whose outflows totalled more than $413m in the first half of the year, but in July alone, inflows have exceeded $432m (£263m).Exchange-traded product holdings climbed for a fifth day on July 29, reaching a record 2,152.222 metric tons, Bloomberg reported.
Hedge funds and other money managers lifted their net-long Gold positions by 7 percent to 235,617 contracts in the week to July 26, data from the U.S. Commodity Futures Trading Commission showed.
Investors put $570 million into commodity funds in the week ended July 27, the fourth consecutive increase, and year-to-date inflows totaled $11.05 billion. Net long positions in 18 commodities rose by 10,063 futures and options contracts to 1.27 mn in the week ended July 26.
In recent weeks, precious metals have rallied on US debt crisis and Eurozone sovereign debt issues. The US GDP for second quarter also came below expectations and global inflationary trends provided firm support for gold and Silver while platinum, Palladium has been boosted by autocatalyst demand.
Source : http://www.commodityonline.com/
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