Russia Looks To Diversify Reserves Into CAD

Thursday, 26 November 2009 13:29

“Of the G10, CAD is the second largest gainer against the USD today. What has separated the CAD from the rest of the majors were the Russian comments on reserve diversification. Thus far there has been plenty of speculation surrounding global central banks eventual diversification strategy but no actual details. This was very specific remark from a major reserve accumulator.”

- Peter Rosenstreich, Chief Market Analyst

Gold Still Not A Bubble

“We have seen massive buying interest for gold since the IMF announcement of India’s purchase, and even as we’ve cleared $1180 levels, speculation is rife that more central banks will follow suit, driving up demand. The unrelenting momentum of gold’s rally has surprised many people, re-igniting chatter about the possibility of a bubble or blow-out reversal. But while the 25% rise in the past 3 months is still impressive, compared to previous commodity market bubbles, the pace and scale of the move is far from extraordinary. If we look back at the oil rally in 2008; prices rose over 35% in the 3 months leading up to the peak, and in the soy bean rally of 1973 contracts traded 98% higher in the three months before the crash. In our view, gold has room to go even higher before it approaches ‘bubble’ status.”

- Elizabeth Gregory, Market Strategist