Mid-Day Gold & Silver Market Report 2/21/2012
SILVER PRICE UP 20% IN JANUARY; GREECE DEAL GETS MIXED REVIEWS
Precious metals prices continued to climb this morning. A deal was reached for the Greek bailout package, which encouraged a stronger euro and boosted Gold’s price. Andrey Kryuchenkov at VTB Capital said, “The biggest problem for Gold would be a stronger dollar. I remain bullish in the longer run.” He added that low or negative real U.S. interest rates would continue to act as a catalyst for ongoing investment in bullion. Regarding China’s reduction in Silver imports, Commerzbank analysts said, “This continues the trend, which we have observed for many months now, towards declining Silver imports, removing a crutch which in the past has been important to the price. That said, the decreased imports were cushioned in January by growing demand for coins and ETFs.” With investors’ support in Silver, the metal gained nearly 20 percent in January.
Although a Greek bailout deal finally was confirmed today, there is hesitation from hedge fund manager Dennis Gartman, who thinks that country will default once a new government is in control following spring elections. Gartman said, “All the authorities have been able to do is delay default by a few weeks, perhaps a few months at best. Greece will default, but perhaps not under the present government in power. A new government is going to come to power following elections that shall take place sometime this spring, and if anyone anywhere believes that the next Greek government shall do anything other than abrogate all the agreements made with the ‘troika,’ then we have a bridge we’d like to sell them at a very high price.” With Greece’s debt issues hopefully being contained, the next countries in line looking for handouts could be Portugal and Ireland. Jonathan Tepper at Variant Perception is not optimistic about Europe’s failing countries. He told CNBC, “Greece will have to restructure their debt; Portugal will have to; Ireland will if they’re smart.”
At 12:01 p.m. (CST), the APMEX precious metals spot prices were:
- Gold - $1,752.30 – Up $27.40.
- Silver - $34.21 – Up $0.92.
- Platinum - $1,683.10 – Up $48.20.
- Palladium - $711.50 – Up $22.40.