Daily Brief – German Gold

German Gold

With 3350 tonnes in the vaults and the 2^nd largest gold reserve in the world after the USA, Germany has EUR 440 billion worth of moolah tied up in that asset class. Some people both inside and outside Germany are saying it might be time to spend some of it. The Bundesbank is naturally resisting those calls, and the mantra is that such asset realization should be saved for times of crisis. For Germans wishing to look at all that gold, 1236 tonnes is stored with the Federal Reserve in New York and 404 tonnes with the Bank of England in London, with the rest i.e. roughly half in Frankfurt. With the cooling of the US relationship, watch this space for German political pressure for Germany bringing their USA lodged gold home – or maybe given the current Merz/Starmer bromance, they will place it in the Bank of England .

EUR/USD 1.1708.

Brent Oil

With the price up at USD 111, the market is weighing further supply disruption for longer and the news that POTUS does not “like” the 2 Iranian conditions to allow oil to be transported through the Strait of Hormuz which are: the cessation of hostilities and the removal of the US blockade. Meanwhile, environmentalists are angry at BP’s latest set of record profits with cheer leader in chief Ed Miliband saying that such profitability is morally wrong. A case of left brain and right brain here as surely the higher prices will constrain consumption which is good for the environment?

GBP/USD 1.3511.

Gonfreville

The large TotalEnergies oil refinery near Le Havre is working at 100% capacity to process oil and ensure that France does not suffer from the oil product such as diesel and kerosene shortages, that will shortly confront all the rest of Europe. Meanwhile, Gonfreville can handle 250,000 barrels of oil every day which can at least keep France going.

EUR/GBP 0.8665.

Sri Lankan Puff

This is a true story that has broken this week: 22 Sri Lankan monks went on study leave to Thailand. Each brought home 5KG of Kush (no me neither) hidden in their luggage which turns out to be a particularly virulent form of cannabis. Monk #23 who had masterminded the 110KG caper was also arrested and all are currently locked up in a different set of cells than those they are accustomed to in Colombo. This is the first such occurrence of a mass monk Sri Lankan smuggling racket in case it comes up in your next pub quiz.

EUR/JPY 186.81.

Next To Me

This is critically judged to be the standout song in a clutch of top numbers on the album Our Version of Events which, apart from being a great album, broke the record for remaining in the top 10 of the charts for the longest when it managed 63 weeks for Scottish chanteuse Emeli Sande back in 2013.

You won’t find him drinking at the table
Rollin’ dice and staying out ’til three
You won’t ever find him being unfaithful
You will find him, you’ll find him next to me

You won’t find him tryna chase the Devil
For money, fame, for power, out of grief
You won’t ever find him where the rest go
You will find him, you’ll find him next to me

Next to me
Ooh, ooh, ooh
Next to me
Ooh, ooh
Next to me
Ooh, ooh, ooh
You will find him, you’ll find him next to me

When the money’s spent and all my friends have vanished
And I can’t seem to find no help or love for free
I know there’s no need for me to panic
‘Cause I’ll find him, I’ll find him next to me

When the skies are grey and all the doors are closing
And the rising pressure makes it hard to breathe
When all I need is a hand to stop the tears from falling
I will find him, will find him next to me

Next to me
Ooh, ooh, ooh

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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