Gold is staging a slight recovery in Asian.....>

GOLD: Gold is staging a slight recovery in Asian trading, bouncing off its July

3 low of 1,238 after being sold off in line with a broad-based dollar rally.

Gold's weakness this week appears to have been driven by falling industrial

metals prices, which in turn have been a victim of CNY weakness, rather than

higher US real yields. In the absence rise in the yuan and/or industrial metals

prices, gold is likely to remain under pressure in the short term. 

- Bigger picture, based on the historical correlation with real yields, gold's

decline has significantly improved its fundamental outlook, but the metal

remains overvalued on this metric.