Retail investors and market professionals continued to hold opposing views on the direction of gold over the next week, according to the Kitco News Wall Street vs. Main Street weekly gold survey.
This week, Kitco’s online and Twitter surveys received a combined 783 votes. A total of 438 respondents, or 56%, said they were bullish on the week ahead, while 230, or 29%, were bearish. The neutral votes totaled 115, or 15%.
Meanwhile, 22 analysts and traders took part in a survey for market professionals. Those looking for further weakness made up the largest chunk of voters, 10, or 45%. Seven, or 32%, look for prices to bounce, while five, or 23%, are neutral.
Gold has edged lower for the third straight session and notched its biggest weekly slide in nearly two months on growing expectations for an increase in US interest rates as soon as next month.
Spot gold was down 0.2 per cent at $US1,252.1 an ounce by 2.43pm EDT (0443 Saturday AEST), down1.6 per cent this week in its third straight week of losses.
New York Fed President William Dudley on Thursday said there was a strong sense among central bank officials that markets were underestimating the probability of policy tightening.
That came a day after the minutes of the Fed's April meeting revealed that most policymakers felt a rate increase might be appropriate as early as June, sending gold to a three-week low of $US1,244.
"Those minutes from the last FOMC (Federal Open Markets Committee) meeting I think really gave quite a bit of light to the possibility for that June rate hike," said Phillip Streible, senior commodities broker at R.J. O'Brien in Chicago. "I think that the Fed is now challenged and the market is getting more confident that it's going to happen, provided that the data supports it."
The US dollar retreated from its highest in nearly two months against a currency basket, but cruised to its third week of gains, keeping up pressure on gold.
Holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Shares, rose by 4.5 tonnes on Thursday and 8.9 tonnes on Friday to their highest since November 2013.
With high-yield bond funds suffering the largest redemptions in their history, this week saw gold fund flows soar to their highest in 2016 as buyers took advantage of the lower prices following the same path as George Soros, Stan Druckenmiller, Jana Partners, and Canada's financial giant CI Financial.
As investors appreaed to seek safe haven in precious metals. Gold saw the biggest week for inflows this year with 1.879 m/oz worth $2,359 million dollars.
As SputnikNews reports, demand for gold rose by 21 percent in the first quarter of 2016. Recently, billionaire George Soros invested nearly $390 in gold stocks, having decreased investments in other assets. Shortly after, large hedge-funds followed the example of the legendary US investor.
Between January and March 2016, Soros Fund Management established by George Soros increased investments in gold market assets, according to the company’s data.
Particularly, the fund bought shares worth $264 million in Canada’s company Barrick Gold, one of the world’s leading gold producers. It also bought an option for nearly 1.05 million shares ($123 million) in SPDR Gold Trust, the world’s biggest gold exchange fund.
Soros also made bets on a drop in the US stock market, having decreased investments in stock assets. In the first quarter, the value of Soros Fund’s exchange-traded assets dropped by 37 percent, to $3.5 billion.
Reference: Kitco, Business News, Zerohedge
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