Another Foreign Bank buying Gold

If the sources are accurate, according to the Financial Times, then Russia’s central bank, which without much fanfare (compared to India) purchased 15.5 tons of gold in October, recently indicated that it wants to add another 30 tons to its cache by year-end.

This is yet another example of a central bank with too much $USD looking to diversify its monetary base.

India says it will continue on its trend of last week. What happens when China has a drink out of this punch bowl?

Thanks in part to mounting US deficits and a weak US economy, the US dollar continues to trend lower. After all, a virtual collapse of the banking sector does have its consequences. For some perspective, today's chart illustrates the current trend in the US dollar (blue line) as well as that other world currency, gold (gray line). As today's chart illustrates, the performance of the US dollar has varied inversely to that of gold since the latter stages of the credit bubble. It is worth noting that the US dollar is currently testing resistance of its downtrend (red line) while gold makes record highs.



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