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ARUN Minerals State That Hedge Funds Are Most Bullish On Gold For The First Time In Two Years

Press Release Date: January 30, 2014


As economic stimulus packages look set to continue in a number of countries, in response to slow economic growth, hedge fund managers are taking a bullish stance on gold once more.

Hedge funds are at their most bullish levels in regards to gold bullion than they have been in over twenty four months, as they increasingly look to gold’s attractiveness as an investment hedge against increasingly threatened U.S. expansion brought on by slow economic growth in Europe and Asia. According to data from the U.S government, this year has so far seen speculators raise their net-long position by 80%. In the fourth quarter the U.S. economy grew at a slower than predicted rate resulting in the acknowledgement last week of ongoing global risks by Federal Reserve officials conducting their policy meeting.

With European and Asian policy makers continuing to increase their stimulus packages to combat slowing growth rates, whilst justifying the appeal of alternatives to currencies currently being revalued, January’s gold prices ended the largest single monthly gain in over 36 months. This coincides with a period that sees weaker than hoped for foreign expansion drive and renewed speculation by investors that the Federal Reserve will continue to delay the raising of U.S. interest rates.

Gold futures for January rose by 8% up to $1,279.20 an ounce on the Comex in New York, while the Bloomberg Dollar Spot Index gained 3.3%. Real assets held by gold backed ETPs in January increased by 4.1%, to their highest point since July of 2011, as euro prices for gold bullion climbed by 16% a gain over twice that of the precious metal’s gain in dollar prices, buoyed by European asset backing for bonds.

“The situation as it now stands for gold prices could hardly be called unexpected, as we have seen prices drop to unrealistic lows caused by the mass selloff and market saturation in 2011 and held depressed by two years of high optimism of economic growth. This situation could clearly not last and as we have seen, those who understood this to be the case, have been buying at accelerated rates to keep ahead of rising prices, prices which have a great deal of inflation and yet to experience if the world’s largest fund managers are correct” detailed ARUN Minerals Chief Executive Officer Mr. Han Liu Wei, commenting on the months record setting gains.

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