GFMS: First-Quarter Gold Hedging Slips Again by 80,000 Ounces Societe Generale and Gold Mining Services (GFMS) released the latest quarterly global gold hedging report analysis on Friday (June 15th). The following is a report. Main content: In the first quarter of this year, the manufacturer's hedging volume once again dropped by 80,000 ounces. In the first quarter of this year, the amount of hedging of major manufacturers fell to 5.07 million ounces. In the fourth quarter of last year, the figure was revised to 5.15 million ounces. Seven companies increased their hedging positions, while the number of companies that reduced their hedging positions increased to a record high 33.

Most of the attention-grabbing activities in the first quarter came from hedgers. On the other hand, companies that reduce hedging come from persistent long-term sells, and the expiry of option positions is seldom due to the elimination of hedging. In the first quarter of this year, the producer’s debt-to-market debt-to-market debt ratio increased by 23% to a debt of US$1.52 billion.

Compared to other market sectors such as mining supplies, scrap gold and jewellery casting, the impact of gold hedging on the net market remains flat. The number of Delta hedging due to the new hedging program and the producer option position will exceed the planned delivery and option expiration amount, and therefore think that there will be a small amount of net hedge again this year.

Hedging data in the database shows that there will be 1.38 million ounces of gold that will be de-hedged during the rest of the year. However, it is not expected that this will be the case.

Known hedging activities in the second quarter of this year are still limited, but it is expected that as a part of the risk management associated with project ** and credit plan security, a small number of scattered hedging plans will continue.

In addition, in addition to expectations of an increase in the volume of the hedging plan, the price of gold is expected to rise at the end of this year. Consistent with the outlook, most hedgers who expect to sell call options on the counter-balance sheet will invest further, which will lead to an increase in the number of delta hedges. On this basis, it is expected that the number of net gold hedges will rise moderately in the market this year.

No change was observed in the management's attitude towards hedging, and most companies still see more gold prospects. Therefore, it is expected that the tactical hedge against the price of gold, rather than the condition of the project, will still be almost absent.

Compared with other factors driving the market, such as casting demand, investor demand or supply of gold scrap, the impact of this year's hedging/de-hedging is expected to remain marginal and will not be an important factor in driving and supporting gold prices.

HSBC: Loose expectation to support gold prices Madhut Jha, macro economist at HSBC (June 15th) said that the market’s expectations of a new round of easing policy and the poor outcome of the Greek election This will support the rise in gold prices.

Madhut Jha said that economic optimism weakened the impact of weaker economic data at the beginning of the year. She also stated that the results of the Greek election may have a bad influence on the financial market.

HSBC precious metals analyst Jim Steel said, "If the investor easing policy is expected to rise further, the price of gold will rise further."

He added: "Traditionally, political uncertainty will benefit gold."

Jha believes that the slowdown in economic growth in emerging market countries has been magnified because exports to China’s electronic products and commodities are relatively stable.

In addition, the Middle East has enough measures to promote economic growth. Steel said that "the better economic situation in the Middle East supports the gold price theoretically."

The global central bank wants to join hands to save the market. The price of gold will take a good chance in the middle. The Greek election will produce results at 3 am Beijing time on the 18th. After the formation of the new government, whether Greece will opt out of the euro area is still suspenseful.

The market is extremely nervous about the future of Greece in the euro area. The world’s central banks are the first to travel and are ready to rescue the market: European Central Bank President Mario Draghi hinted to consider a rate cut, and the United Kingdom announced plans to provide 100 billion pounds to the banking system (about 1.2 trillion RMB Hong Kong dollars).

Market concerns eased temporarily, stimulating global stock markets to rise generally on Friday. At the same time, the prospects of Greece will also have a profound impact on the midline trend of international gold prices. International investment institutions have remained cautiously wait-and-see attitudes, and gold prices have hovered at a higher level in the near future.

In response to the huge impact that the Greek election may have on the global financial market, the global central bank preempted to travel and said it was ready to rescue the market. The Bank of England took the lead in supporting credit and central banks in Europe, Japan and Canada also expressed support for easing.

[European Central Bank provides more funds]

The German central bank and the government earlier stated that after Spain’s assistance from the bank, there is no need for additional assistance. This has also caused the Spanish 10-year bond yield to fall from the warning level of more than 7% last Thursday to 6.75%.

Draghi said last weekend that the euro zone economy is facing great risks, and there is no risk of inflation, so that the market believes that the European Central Bank will soon cut interest rates, or introduce other loose policies. Draghi stressed that the central bank stands ready to provide more liquidity to the debt-repaying banks, emphasizing that the two three-year renewed operations (LTRO) had stopped major credit contractions.

[British Bank to push new volume]

Schertz, an economist at Berenberg bank, believes that excluding the results of the Greek election, everything points to the ECB cutting interest rates. If the Greeks commit suicide, the central bank may not only reduce the ratio by 0.25 percent, but may also introduce a new round of LTRO and debt purchases.

The British Chancellor of the Exchequer, George Osborne, announced on Thursday evening that he and the Bank of England governor, Kingn, will provide 100 billion pounds to the banking system to increase domestic credit supply and meet the "black cloud" of the European debt crisis. The Bank of England also indicated that the rationale for the introduction of a new round of quantitative easing policy has become stronger.

The Bank of England plans to invest so that the bank will receive less than the cost of the market in a few weeks, in exchange for the other party's lending commitment, it is expected to promote 80 billion pounds new **. At the same time, the Bank of England will offer banks six months of liquidity of less than £5 billion per month starting next week at a rate of only 0.75%.

The Bank of Japan last week kept interest rates and asset purchase plans unchanged, saying that it would do its best to maintain the stability of the banking system. The president of the bank said that if the election made the market more nervous, central banks could provide liquidity to stabilize the market. In addition, the Japanese Ministry of Finance warned that if the hedging funds excessively pushed up the yen, it entered the market for intervention.

[Barclays: Greece who will not be off the European court]

Barclays expects that Greece will eventually be able to successfully organize a coalition government and no further reelection will be required. Regardless of whether the final result is played by the New Zealand or Left Alliance (SYRIZA), the new government will work with the Troika, the International Monetary Fund (IMF), the European Union, and the European Central Bank to tighten their goals for the country. Negotiate.

If the government is ultimately led by the left-wing coalition, the negotiation time will be longer, and the negotiations may lead to a stalemate because of the issues of labor market and pension reform. Although the New Party’s position is not intended to be “Brexit”, Barclays believes that the left-wing coalition will not make the “Brexit” decision.

Although Barclays has speculated that the events are most likely to follow the above circumstances, they do not rule out other possibilities, such as the re-election of Greece.

[Golden Market Reaction: Gold Midline or Deviation from Euro]

The announcement of the election results in Greece early this morning will have a profound effect on the midline trend of international gold prices. The international investment institutions have maintained a cautious wait-and-see attitude before this, and the gold price hovered at a higher position in the near future, reporting at 1,626 US dollars an ounce. The central banks of the world's major countries are preparing to provide liquidity after the Greek election this weekend, and this measure itself should be good for gold prices.

The analysis believes that if Greece retains the qualifications of the euro zone members, then the risk appetite will rebound instantly, promote the species including the euro, precious metals and other species to achieve a larger rebound, short-term to mid-line trend will tend to bull market development.

If the election results expose Greece to the risk of exiting the euro zone, the precious metals may go down in the short term; but it is not ruled out that there will still be a large amount of hedging funds that will buy gold, hedge funds, and other safe currency while avoiding risks. From the perspective of gold prices, the divergence from the euro may continue to escalate.