GOLD PRICES rose but silver didn't in Asian and London trade Wednesday, holding the 'safe haven' metal's relative value over its more industrially useful cousin near 5-month highs even as global stock markets extended their recovery from Monday's sudden crash.

 

Recession fears in the US appeared to ease as bond prices slipped and market forecasts for end-year Fed interest rates rose to 4.35% per annum – still almost 1 percentage point below today's 2-decade high but 0.15 points above Monday's crash low.

 

Toyko's stock market meantime rallied sharply for a 2nd day as the Yen retreated further on 'dovish' comments from the Bank of Japan, cutting the Topic index's loss since this time last week in half to barely 10%.

 

European and US equities cut their 1-week losses towards 4%, and oil rallied from this week's 5-month lows to rise above $75 per barrel of US benchmark WTI after new data showed a much sharper-than-expected drop in stockpiles of crude and refined product in the world's largest economy, signalling strong demand.

 

But base metals copper and aluminum held at 5-month lows, down 17.4% and 24.0% from May's 2-year and all-time record highs respectively.

 

Rising back above $2400 per Troy ounce in London's 3pm bullion auction, the price of gold had earlier fixed around $2395 at the morning benchmarking.

 

 

"Obviously, sharp volatility in domestic and overseas financial markets means it's necessary to maintain current levels of monetary easing for the time being," said the Bank of Japan's deputy governor Shinichi Uchida in a speech today, rowing back from the 'hawkish' outlook for further rate rise given by BoJ Governor Kazuo Ueda last Wednesday, when the central bank in Tokyo raised the cost of borrowing from zero to 0.25% per annum – the highest in 15 years – and spurred a panic out of the Yen carry trade leading to Monday's stock market crash.

 

The Yen fell further against the Dollar from Monday's spike to the strongest so far in 2024, reversing 3/4 of the previous 5-session's 5.3% surge.

 

That still left the Japanese currency over 10% higher from the 4-decade lows hit only this time in July, the sharpest 1-month appreciation since late 1998, when the Yen rebounded from multi-year lows hit during the Asian Crisis.

 

Gold prices in Shanghai had meantime risen to show an $11 per ounce premium over London quotes on Wednesday, suggesting a rebound in demand in China – the 'safe haven' metal's No.1 mining, consumer, importing and central-bank buying nation – after a run of record-high incentives for new imports of bullion evaporated last week.

 

Latest data from the People's Bank said today that the authorities in China didn't buy any gold for the nation's bullion reserves in July, extending the break which began in May.

 

Separate data Wednesday said that China's giant trade surplus retreated a little last month as export growth slipped below the pace of expansion in imports into the world's 2nd largest economy.

 

 

World No.3 economy Germany also saw its trade surplus slip lower in June as exports fell faster than imports, but its industrial output rebounded harder than analysts expected, easing concerns over a return of recession to the 20-nation Eurozone.

 

Euro gold prices flattened beneath €2200 per ounce, while the UK Pound price traded at £1884, holding 1.6% above Monday's 1-week lows.

 

With silver bullion prices meantime holding below $27 per Troy ounce in late-London trade today, platinum rallied to $927, cutting this week's loss so far to less than $50, while palladium prices jumped through $900, extending its rebound to 8.1% from Monday's 7-year low.