Margin Requirements on Gold Raised Again |
The Chicago Mercantile Exchange has again raised margin requirements on gold after the price on the most popular hedging asset reached the psychological $1900/oz mark. The increase in margin requirements, as previously expected, was followed by a drop in gold prices by more than 7%. Now the minimum deposit to trade gold futures will increase 27% to $9,450 per contract on speculative operations with 100 ounces of gold. The margin requirements were already increased by 22% on August 11. A spokesman for the CME explained that the decision was made after interest in gold purchases increased sharply on August 18 to a record 1.263 million contracts. Gold prices rose 24% for 2011, continuing 11 years of continuous growth as the unstable global economic situation increased demand for the precious metal as a means of preserving capital for investors the world over.
The IFO Institute reported at 12:00PM (Moscow Time) that confidence among German businessmen dropped to its lowest point of the last 12 months. According to the Munich institute’s report, the Business Climate Index, based on a survey of 7,000 managers of German companies, dropped to 108.7 in August versus 112.9 in July. Managers are anticipating a decrease in the volume of their goods being exported due to the global slowdown in the consumer sector. The evaluation of the current conditions in Germany dropped to 118.1 from 121.4 and the index reflecting German entrepreneurs’ expectations for the next six months fell to 100.1 from 105.0 in June 2011. RoyalMaxBrokers analysts observed that German entrepreneurs’ sentiment worsened after a series of negative statistics came out. The country’s economic growth rate in the second quarter of this year was only 0.1%, which is below the 1.3% seen in the first quarter; furthermore, the ZEW index results turned out to be lower than experts had predicted.
RoyalMaxBrokers analysts report that the volume of durable goods purchases in the US in July increased. A report published by the US Department of Commerce at 4:30PM (Moscow Time) showed that orders for goods whose durability was more than three years increased by 4%, which was the best figure of the last four months. Analysts polled by Bloomberg forecasted more modest growth of this figure, around 2%. Ryan Sweet, an economist with Moody’s Analytics, believes that the improvement in the July figure does not give enough reason to believe that the US economy is recovering and that more time and actions from monetary authorities and the government are needed for US businesses to start hiring again and for Americans to start spending again without worrying about the future. The statistics showed that the volume of orders for machines, computers, and communications equipment went down in July 2011, but at the same time, orders for vehicles and air transport increased. In general, if one were to divide this figure into separate segments then it would be apparent that changes to the volumes of some of them fell up to 1%, while orders increased 7.5% on others. The air transport category should be separated, since orders in this category increased 43.4% for the month of July. Boeing Co. reported that in July 2011, it received 115 orders compared with 48 in the month of June.
Steve Jobs, the head of Apple, announced that he is resigning from the position of CEO. In a letter to the Board of Directors, he said that, as he had promised before, he would leave his position as head of the company when he could no longer fulfill the obligations entrusted to him, and that day has come. Jobs personally recommended Tim Cook to take over as the new CEO and on Wednesday evening, Apple’s Board of Directors approved his request. The market’s reaction was unmistakable – Apple’s shares fell 5%. Analysts think that such a scenario was already absorbed by the market when rumors about Jobs’ worsening health began circulating in the press.
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