This week, CME Group’s metals complex set a number of consecutive open interest records:

•    High Grade COMEX Copper set two consecutive records for combined futures and options open interest this week, surpassing the previous record of 171,065 contracts on 11/4/2010.
o    1/31/2013 – 178,470 contracts
o    1/30/2013 – 173,518 contracts
•    NYMEX Palladium set four consecutive records for combined futures and options open interest this week, surpassing the previous record of 48,489 contracts on 1/25/2013.
o    1/31/2013 – 53,587 contracts
o    1/30/2013 – 52,761 contracts
o    1/29/2013 – 51,050 contracts
o    1/28/2013 – 50,359 contracts
•    NYMEX Platinum set four consecutive records for combined futures and options open interest this week, surpassing the previous record of 96,087 contracts on 1/25/2013.
o    1/31/2013 – 99,676 contracts
o    1/30/2013 – 98,105 contracts
o    1/29/2013 – 97,477 contracts
o    1/28/2013 – 96,967 contracts

Please let me know if you have any questions, or would like to speak with a CME Group representative about our precious and base metals products.

Best, Chris

Chris Grams
Director, Corporate Communications
CME Group
o 312 930 3435
m 312 813 5122
chris.grams@cmegroup.com

20 South Wacker Drive
Chicago, Illinois 60606
www.cmegroup.com

Welcome to this first edition of Gold Investor [attached], which provides a selection from the World Gold Council’s latest body of research on the increasing relevance of gold as an investment asset, whether acting as a portfolio diversifier or as a risk management tool.

This edition comprises:

Gold investment commentary. A summary of Q4 and full year 2012 and macroeconomic developments likely to influence gold in 2013.

Gold and currencies: hedging foreign-exchange risk. Explores some of the benefits gold can provide from a currency-hedging perspective. Given the prevailing low-interest rate environment, the search for yield is driving investors to look into more aggressive strategies, and some investors have begun to rotate into risk assets – notably equities, emerging markets and alternative assets, including commodities related to the growth cycle. A prudent hedging strategy necessitates allocations to assets which offer diversification benefits, hedge currency risk and unexpected market turns. Hedging investments in foreign assets entails a cost, and gold can mitigate certain risks, in particular those related to emerging-market currencies.

Tail risk hedging: an international perspective. Considers gold’s role in mitigating the impact of tail-risk events – unpredictable events that might be considered unlikely but nonetheless can cause considerable damage to investors’ capital when they do occur. The advantages of gold’s role in portfolio risk management have, over the past decade, become better understood in Western markets. In Japan, the role of gold in a portfolio context has only recently gained recognition, yet has advanced substantially in the past 18 months; gold is increasingly being considered by Japanese institutional investors as offering a solution that meets today’s needs.

Foreign-reserve diversification for emerging-market central banks. Examines the role of gold for emerging market central banks from a local-currency perspective and looks at optimal gold-allocation ranges for foreign reserve portfolios.

Marcus Grubb
Managing Director, Investment

To download or subscribe to our gold investment research studies:
http://www.gold.org/investment/research

World Gold Council
10 Old Bailey, London EC4M 7NG, United Kingdom

T 44 20 7826 4700   F 44 20 7826 4799   E investment@gold.org   W www.gold.org

This message is provided for information purposes only and should not be construed as a solicitation or offer to buy or sell securities or related financial instruments. E-mail transmission cannot be guaranteed to be secure or error-free. The sender does not accept liability for any errors or omissions in the contents of this message which may arise as a result of e-mail transmission.

© 2013, World Gold Council. All rights reserved.

New York, NY, 29 January 2013. CPM Group has released the 2013 update to its Silver Long-Term Outlook market study. The report provides an update of CPM Group’s in-depth analysis of global silver mine production, secondary supply, fabrication demand, investment demand, inventory levels, and prices. Each sector is analyzed and discussed in detail with scenarios forecast through 2022. This report is an update to the 2011 full report.

Highlights:

After languishing between $3.50 and $5.50 for most of the time from 1990 through 2002, silver prices then rose to as high as $49 in the first half of 2011. Silver prices have trended lower since then, mostly trading between $26 and $36 since September 2011. While some silver market observers continue to hypothesize that silver prices will head higher, CPM Group identifies several emerging trends in the market that could result in wobbly investment demand over the next decade, which may weigh on prices going forward.

One of the key variables that determine silver prices is investment demand. Investors were net sellers of silver from 1990 through 2006. They have been large net buyers of silver since 2006, with their interest fueled by the series of economic and financial crises to occur since that year. The single most important question facing future silver prices is how much silver investors will want to buy going forward – or whether they might revert to long-term selling as they did only a few years ago. The CPM Group report studies the economic and financial variables that have been driving silver investment demand in recent years and presents an unbiased argument for somewhat weaker silver prices over the projected period as well as a detailed analysis of global and regional economic and financial trends expected to unfold over the coming decade.

There is a substantial amount of silver mine production capacity that potentially could to be added to supply over the next ten years. The extent to which this wave of possible new production comes on stream will depend in the interaction of silver price trends, management of the development programs, and the availability of financing for new projects. The updated report contains details about the new mines expected to begin production over the next ten years.

Higher silver prices and technological innovations such as digital imaging and the shrinking of electronic components have reduced silver use over the past decade. The extent to which these trends are offset by higher unit output in electronics, the emerging solar power industry, and other applications using silver is reviewed carefully in CPM Group’s 10-year projections. The report contains industry analysis of each major source of silver demand and projections for silver demand from each of these sources.  

The CPM Group Silver Long-Term Outlook is part of a series of long-term studies of precious and specialty metals markets that CPM Group has produced since the 1980s. These studies are used by producers and industrial users for strategic planning and in the preparation of technical reports. In addition, institutional investors and physical traders supplement their internal research with CPM Group’s comprehensive analyses, conclusions, and projections. The reports serve as authoritative reference guides for platinum group metals market statistics. CPM Group sells the reports as stand-alone products, although most clients use the CPM Group reports as parts of broader consulting packages related to the specific metals markets.

About CPM Group:

CPM Group is an independent commodities research, consulting and corporate advisory company headquartered in New York. The company is considered the foremost authority on markets for precious metals, and provides detailed and highly regarded research on specialty and base metals, energy, and agricultural markets. CPM Group provides advisory services relating to commodity risk management and asset management as well. The group has produced annual reports on gold and silver since 1971, and annual surveys of the platinum group metals markets since 1981.

To view the full table of contents, please click here. Alternately, contact Matt Taub at (212) 785-8320 or info@cpmgroup.com to learn more about CPM Group’s advisory and consulting services as well as our research product offerings.