New London Silver Fix To Launch

  • Posted Thursday, August 14, 2014 at 01:24 PM

Los Angeles CA, August 14 (Tangible Investments) - by James O’Dell - Gold and Silver prices were mixed on Wednesday, with Gold gaining $3.90 or 0.30 percent to close at $1,312.70 an ounce, after retail sales remained unchanged in July, pointing to a slowing economy while easing investor fears that the Fed will hike interest rates sooner than expected. This weighed on the dollar while it underpinned Gold, as Silver dipped $0.10 or 0.50 percent to close at $19.81 an ounce, while the Gold/Silver ratio rose to 66.26.

"In the absence of notable physical demand or renewed safe haven inflows the market is set to continue its current sideways pattern at the end of this week," said VTB Capital.

Meanwhile, all eyes are on the Chicago Mercantile Exchange (CME) as it gets set to roll out its new Silver fixing engine on Friday. The predecessor London Silver Fix was a global spot benchmark for 117 years that was effectively killed off in April, when Deutsche Bank halted its participation in the fixing process. Deutsche Bank's departure from the process left just two banks on the fixing panel, Bank of Nova Scotia and HSBC Holding, and according to those familiar with the matter, the process was rendered unviable.

Starting August 15, CME Group and Thomson Reuters will operate the new Silver Fix, renamed the "London Silver Price," jointly with the London Bullion Market Association (LBMA). The new process being used to establish the new London Silver Price is designed to not only maintain continuity with the previous London Silver Fix process for market participants, but it will also increase transparency and the number of participants by the use of an electronic auction platform.

CME Group will be responsible for providing the electronic auction platform that will calculate the price. Thomson Reuters will handle the administration and distribution, while the LBMA will be responsible for accrediting market participants.

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