Gold's London AM fix this morning was USD 1,662.00, EUR 1,271.61, and GBP 1,057.93 per ounce.
Yesterday's AM fix was USD 1,694.75, EUR 1,291.44and GBP 1,082.63 per ounce.
Gold fell 1.7% in New York yesterday and closed at $1,676.10/oz. Gold fell in Asia prior to further falls in Europe which has gold now trading at $1,656/oz.
Fed Chairman Ben Bernanke offered no insight as to whether there will be another round of QE and the Fed said the economy was "expanding moderately" though growth still faced significant downside risks.
Gold has broken below $1,660/oz to its lowest since January 25. Gold is now below the 200-day SMA at $1,681.08/oz as well as the 38.2% Fibonacci retracement from September's record to December's lows.
Support is at $1,650/oz and below that at $1,600/oz and $1,550/oz (see chart below).
Despite continuing caution regarding gold in western markets, lacklustre buying and indeed some selling - there is still strong buying from Asia store of wealth buyers.
Singapore Seeks To Be Asian Bullion Hub With Tax Free Gold and Silver
Another sign of Asia's increasing importance in the global gold market is news that Singapore is planning to boost its share of global gold trade sevenfold after scrapping taxes on gold, silver and platinum bullion.
This is the aim of the International Enterprise Singapore, the city state's external trade agency according to Bloomberg.
Currently just 2% of world gold demand flows through Singapore and Singapore is aiming to increase that to 10% to 15% over the next five to 10 years, Kathy Lai, assistant chief executive officer at IE Singapore, said.
Singapore will exempt investment grade gold, silver and platinum from the 7% goods and services tax to turn the country into a bullion trading hub, Finance Minister Tharman Shanmugaratnam told parliament in his budget speech on February 17. The change, which takes effect on Oct. 1, will apply to gold of 99.5 percent purity, silver of 99.9 percent purity and platinum of 99 percent purity.
"Most other financial centers consider gold as a financial asset so few place any kind of tax on precious metals and we discovered that it was an impediment," said IE Singapore's Lai. "We noted that gold demand increasingly is dominated by Asian consumers and investors and we feel that this is something we may have missed out on."
Asia doesn't have a so-called gold hub, where there's a critical mass of traders and storage, like in London and Zurich, said Lai.
"Vis-a-vis Dubai, we are a more credible financial center, vis-a-vis Hong Kong, we are seen as not part of China and therefore more neutral," she said.
This is another step towards price discovery in the precious metals market being related to supply and demand of the physical metal and not the machinations of banks and hedge funds manipulating the paper gold market on the COMEX.
Bloomberg Link Precious Metals Conference - Gold 21% Gain In 2012
The Bloomberg Link Precious Metals Conference took place in New York yesterday and the majority of participants were bullish on gold.
Gold may rise to $1,897/oz by December 31 from $1,566.80 at the end of 2011, based on the average of 14 respondents in a survey at the conference.
Gold is poised for a 21% gain in 2012, extending its bull market to 12 consecutive years, as investors diversify into gold and central banks expand reserves for the first time in a generation.
The majority of participants expect central banks will take additional steps to spur economic growth and continue to debase currencies.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.