Daily Market Report 05/01/12

GOLD
Gold was range-bound from $1,656 to $1,672 today as commodity trading in a number of Asian precious metal markets, including China, Hong Kong, India, Malaysia, Philippines, Singapore, South Korea, Thailand, Taiwan and Vietnam, are closed for the May Day holiday. At 11am PDT, Gold was trading at $1,662.50, down $2.90 on light volume.       

                                                                             Can 2 ½ Million Chinese be Wrong?
It was just reported that in 2011, China imported, through Hong Kong, 428 tons of Gold. The latest figures show the rate of Gold accumulation in China increasing.  More than 79 tons through the end of February puts China on a path to acquire 479 tons in 2012. Much of this demand is coming from the Chinese Gold Bank accumulation programs.  At that rate, China will be the largest importer of Gold in the world, over taking India, whose government, to defend the rupee, has turned hostile to Gold importation which the population is fighting every step of the way.  

In the past two years, the ICBC Bank Gold Accumulation program in China has grown to 2 ½ million Chinese clients. At the current pace of growth, the bank should have over 5 million Gold accumulation clients by 2015. ICBC bank is currently holding over a billion dollars of Gold in their vaults. Gold Accumulation programs have not only been very successful in making Gold more accessible in cities, but also in more rural parts of India and China as well, plus the owners of these accounts are long term investors.

SILVER
Silver was supported by lower than expected U.S. consumer spending in March. The increase was only 0.3%, after a sharp increase in February. Silver was down $0.02, trading at 11am PDT at $31.04 on a low volume of trades.