Gold quiet as bankers prepare to gather

Gold was going nowhere again ahead of the central bankers’ gathering at Jackson Hole on Friday.

Credit Suisse has published an analysis of gold’s performance before and after the symposium and come to the conclusion that it doesn’t make too much difference either way.

While gold tended to end the week after the event higher rather than lower and volumes rose, the improvement didn’t last long and the moves were small at less than 2% in four out of the last six years.

Recent history, Fed chair Janet Yellen’s dovishness and current market positioning means this year’s Jackson Hole get-together is also unlikely to be a major source of volatility, the Swiss broker added.

Elsewhere, geopolitical events have not been sufficient to draw in consistent new buying especially as Asian markets remain uninspiring.

Gold drifted even though SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, saw its first nflow in nearly four weeks on Monday.

Physical demand for gold from both the investment and jewellery sectors remains quiet, though Indian demand would typically be expected to pick up from the final week of August onwards said Credit Suisse.

On top of this, mine supply is still rising with production estimated to have increased 10% year-on-year in the second quarter according to the World Gold Council and likely to plateau over the next four to six quarters.

Spot gold was US$2 lower at US$1,296 an hour into trading on Wall Street, silver was down at US$19.40 and platinum eased US$5 to US$1,435.