London 23/06/2011 - A mix of technical and safe-haven demand pushed gold to its highest since posting its lifetime record at $1575/oz yesterday; the yellow touched $1558.50, in addition to setting new all-time peaks in Sterling and Indian Rupee terms. The gains in gold also bolstered the rest of the precious complex; silver was up 1% at one point, touching a two-week peak of $36.77, with palladium up a similar amount on its highs. However, the complex closed off the highs, posting a net 0.3% gain and ran into further profit taking during after-market trade as the FOMC maintained its “extended period” stance on keeping interest rates at record low levels; “I think the thrust of extended period is that we believe we're at least two or three meetings away from taking any further action, and I emphasize "at least," said Fed Chairman Bernanke. “But depending on how the economy evolves and inflation and unemployment, it could be significantly longer.” Fed and regional-bank officials revised this year’s growth forecasts down from 3.1-3.3% to 2.7-2.9% with the US economy expected to expand by 3.3-3.7% next year, compared with April’s forecasts of 3.5-4.2%. The Fed also raised their unemployment expectations from an average 8.4-8.7% to 8.6- 8.9%. The CRB Index closed Wednesday with a modest 0.1% decline; however, further pressure has emerged overnight with WTI crude off over 1% and copper around 0.7% at the time of writing. Equities also traded lower yesterday; the Dow and S&P500 both settled down 0.6% and led to a weak start this morning with the Nikkei and MSCI Asian Pacific Index both off 0.3% at the time of writing. The dollar did gain some ground though with the DXY closing up 0.4% and is holdings in positive territory so far this morning. Data overnight has shown a slowdown in China’s HSBC Flash Manufacturing PMI from 51.6 to 50.1. The line-up for the rest of the day includes EU, French and German Flash Manufacturing & Service PMI; US Jobless Claims and New Home Sales. ECB President Trichet is also scheduled to speak at today’s EU Economic Summit. The gains yesterday saw gold break above the previous $1550-53.80 resistance band, but the metal was unable to hold its gains by the close and will continue to face upside resistance in the coming sessions. However, gold is still holdings its chart up-channel, with momentum indicators coupled with ongoing debt and growth concerns set to fuel further gains with a close above $1555 opening the way to challenge the metals all-time high.

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