Bullion & Business Weekend Report – Feb. 13

Precious metals drove on a bumpy road this week to register gains after tumbling the prior week when the dollar rallied to an 8-month high against the euro. Worries over the debt crisis in Greece, and the European handling of the situation yanked the euro and greenback around, which controlled gold’s direction for much of the week. World stocks were also watchful and reacted to the ups and downs.

The yellow metal dipped slightly on Wednesday when the Federal Reserve signaled that it may hike interest rates. Gold rallied back on Thursday on talks that European nations would lend a helping hand toward Greece. On Friday, the deficit concerns were still noted, but China took center stage by surprising the markets in moving to limit bank loans yet again. New data was also released showing weaker-than-expected growth in European Union countries. These events drove commodities and stocks lower for the day, paring weekly gains.

New York crude oil fell for the first day in five on Friday, but the four positive sessions were enough to tip weekly prices higher by 4.1 percent, and prevent a five-weak losing streak.

U.S., German, French and London stocks all enjoyed weekly gains, despite Friday losses for all but the Nasdaq. European shares were set to extend a winning run to five days until the aforementioned news broke.

In weekly London Fix bullion prices, gold rose $24.00, or 2.3 percent, to $1,082.00 an ounce. Silver advanced 16 cents, or 1.1 percent, to $15.33 an ounce. Platinum settled at $1,505.00 an ounce, rising $30.00, or 2.0 percent.

"Gold is reacting to liquidity constraints implemented by the People’s Bank of China and a further strengthening of the dollar," Bayram Dincer, a commodity analyst at LGT Capital Management in Pfaeffikon, Switzerland, said on Bloomberg.

In weekly New York metals prices, April gold gained $37.20, or 3.5 percent, to end at $1,090.00 an ounce. Silver for March delivery finished at $15.447 an ounce, jumping 62 cents, or 4.2 percent. April platinum climbed $36.00, or 2.4 percent, to close at $1,511.10 an ounce.

"The gold market has been hit by some very negative news — the Chinese monetary tightening and further unwinding of the carry trade related to uncertainty over Greece," James Steel, chief commodities analyst at HSBC in New York, said on Reuters.

Gold, considered a hedge during times of high inflation and economic uncertainty, tends to follow oil and move opposite to the U.S. dollar. A rising greenback makes dollar-denominated commodities, like bullion, more expensive for holders of other world currencies.

"Yesterday’s Greek-flavored gold rally turned into today’s Chinese-tinged decline as the Beijing government flat-out demanded that banks freeze more money from being lent. The surprise but unsurprising move to raise reserve ratios by half a percent comes on the heels of a similar move on January 12, senior analyst at Kitco Metals, Inc."Gold prices turned lower following the Chinese lending-restrictive move. "

To follow are silver, gold and platinum performance charts, oil news, week-ending stocks, and precious metal article summaries.

London Fix Charts: Silver, Gold and Platinum

(Feb 5 – 12)

The London Fix is one of the most used bullion quotes around the world. The London AM fix for gold and platinum begins at 10:30am GMT (5:30am in New York), and the PM fix begins at 3pm GMT (10am in New York). The London Fix for silver begins each business day at 12pm GMT (7am in New York).

London Fix Precious Metals Prices

Weekly World Business News: Oil, Gasoline, and Stocks Prices

Oil prices rose on Friday "as China’s move to hike bank reserve requirements sparked concern over a prospective slowdown in its economic growth and with it, its appetite for commodities," wrote Polya Lesova and Nick Godt of MarketWatch. The rise of the US dollar on Friday also pressured crude.

"It’s the rise in the dollar that is affecting the price of crude,"Sean Brodrick, a natural resource analyst with Weiss Research in Jupiter, Florida, said on Bloomberg. "Crude oil is acting more and more like an international currency everyone uses."

New York crude-oil for March delivery declined $1.15, or 1.5 percent, to close at $74.13 a barrel. The price, however, is $2.94 higher than last week.

Prices at the pump slid six-tenths of a cent between Friday and Saturday. The national average for regular unleaded gasoline is $2.622 a gallon, according to a AAA fuel report. The price is 3.9 cents lower than last week, 13.6 cents down from a month back, but still 66.1 cents higher than a year ago.

U.S. stocks retreated on the final day of the week with, again, the China and Greece news cited as factors

"Between China and continued concerns about what the EU is going to do about Greece, there are a lot of negatives out there," Tom Schrader, managing director at Stifel Nicolaus, said on CNNMoney.

"It’s all about the international scenario," James Paulsen, who helps oversee about $375 billion as chief investment strategist at Wells Capital Management in Minneapolis, said on Bloomberg. "China has been more aggressive than many people thought in cooling its economy. There’s fear they might be overdoing it. In the U.S., we’ve been getting decent economic reports. But investors are looking abroad today."

For the week, the Dow and S&P gained 0.9 percent while the Nasdaq jumped 2 percent.

Friday closing figures for the three major US indexes follow:

• The Dow fell 45.05 points to close at 10,099.14.

• The S&P lost 2.96 points, closing to 1,075.51.

• The NASDAQ rose 6.12 points to end at 2,183.53.

And in other world markets:

• The German DAX lost 3.54 points to close at 5,500.39.

• The Paris CAC 40 dropped 17.68 points, to close at 3,599.07.

• And the London FTSE 100 fell 19.03 points to finish at 5,142.45.

Bullion and Business Articles

In related bullion news, interesting or quick-read articles from the week include:

• Gold futures off Friday lows, remain higher for the week – MarketWatch
  Gold and other metals futures fell on Friday, though they finished off lows, as a move by China , one of the world’s biggest consumers of commodities, to slow the pace of bank lending triggered a rally in the U.S. dollar and a sell-off in commodities …

• Gold Declines as Dollar Advances, Stocks Drop on China’s Loans – Bloomberg
  Gold prices fell as China unexpectedly increased bank-reserve requirements, sending commodities and equities lower, while boosting the dollar. The greenback jumped as much as 0.9 percent against a basket of major currencies, eroding the investment appeal of precious metals …

• Neither a Borrower Nor [Mainly] a Lender Be… – Jon Nadler, Kitco
  Yesterday’s Greek-flavored gold rally turned into today’s Chinese-tinged decline as the Beijing government flat-out demanded that banks freeze more money from being lent. The surprise but unsurprising move to raise reserve ratios by half a percent comes on the heels of a similar move on January 12 and will take effect on the 25th of the month.

  As we warned in our article just two days ago, the fact that Chinese banks may have lent as much money during January as in the entire previous quarter, and did so despite the hike in requirements, pointed to this more aggressive move we saw materializing today. Also as pointed out previously, the Chinese lending-curb move is anything but commodities-friendly. In simple terms, where is the funding going to come from to load up on more speculative positions in copper, gold, and a slew of other ‘stuff?’ Well, obviously, not as much from local banks as previously …

For daily silver, gold and platinum price charts, see Bullion Prices Today. Check out how the value of the US dollar has changed over the years via the US Inflation Calculator.