Analysts now opine that the yellow metal would now settle thereabouts unless shocking announcements from the official sector rock the boat.

The yellow metal slumped from its October 29 level of $299.10 per ounce on news of fund-selling in Asia. Thereafter, mining news assumed the centre stage. Topping the list was the Ashanti-Lonmin imbroglio with the latter improving its offer on being spurned by Ashanti. When Ashanti dithered, Lonmin withdrew its offer. With national pride also taking a hand, this matter is far from over.

However, Ashanti has got a reprieve from its bankers for the time being. The net result of lower gold prices is what the doctor ordered for the beleaguered Ghananian mining company. Next was the news of a Canadian mining company having bought one million ounces of gold at an average price of $300 per ounce and would close the counterparty positions of300,000 ounces. Yet another depressant for gold was news from Russia that a bank had license from the trade ministry to sell 60 tonnes of gold-half of Russia's annual production. The only solace being that this was a normal license valid for a year. But should gold prices improve, the temptation could become too alluring to resist.

However, all was not bleak news, the South African president promised to look into safety standards in mines after a blast at one of Anglogold's mines left several dead. Anglogold, like most South African mines, prospects for gold and other minerals are at a depth of 3 kms and more. This is considered dangerous and any legislation that mining cannot be done at such great depths would cramp the entire South African mining industry. South Africa's gold production aggregates nearly 500 tonnes annually and any shortfall could result in another upward price movement. But this is premature for any celebrations.

As is normal now, the PGMs were robust and silver was in dire straits.Platinum zoomed to $425 per ounce before settling lower at $422 per ounce while palladium was steady near the $393 per ounce mark. Silver was down at US cents 507.50 per ounce after holding above 520 cents for most of the week. The white metal seems devoid of any direction at the moment.

Friday saw gold at $289.70 per ounce and silver at US cents 507 per ounce (gold and silver, London, Friday afternoon fixed). Even the advent of Diwali does not seem to have budged buyers from the safety of their homes. As a result, standard gold slumped from Rs 4,640 per 10 gms to end at Rs 4,590.

Silver .999, first improved from Rs 8,190 per kg to Rs.8,240 only to fall in tune with international prices and ended at Rs 8,140 (gold and silver, Mumbai, Saturday afternoon prices). Meanwhile, the South African Central Bank does not seem to believe in practicing what it preaches. South Africa, including its central bank, was at the forefront of an international campaign against gold policies adopted by the InternationalMonetary Fund (IMF) and the European Central bank. Ironically, it is the same South African central bank which announced recently that it had lent 300,000 ounces of gold. Thus the bank which deserved a pat in the back for reviving gold to above the $300 per ounce mark is now in the eye of a storm. Analysts and industry bigwigs have criticised this move. They claim that the quantity, though `peanuts', could send a wrong signal to the bullion markets.

What will gold do if central banks from other gold producing countries, not part of the EU moratorium decide to follow in the footsteps of this bank? Will gold then plummet once again?