GOLD ADVANCES; CHINA’S ECONOMY RAISES CONCERNS IN MARKET
Gold began to soar this morning, holding steady this afternoon with anticipation that China will provide further stimulus to boost its economy and as Spain experiences difficulties with its new austerity measures. Oliver Pursche at GMG Defensive Beta Fund said, "I think it's a combination of further easing by... China, and an overall perception that Gold had sold off significantly over the last few days and it's a good entry point, because the concerns of higher inflation down the road are certainly still very valid." Several banks have forecasted high price targets for Gold with Deutsche Bank estimating $2,000 an ounce by the second quarter in 2013, Citi predicting $2,500 an ounce within less than six months and Bank of America quoting $3,000 an ounce by 2014.
China’s economy is experiencing a tough time right now with a leadership change in the near future and with the nation heading in a downward slope. At this time there has not been a stimulus plan officially announced to create growth for China, but the market is anticipating it. Dan Greenhaus at BTIG said, “Certainly, going into a change in leadership the bias is going to be for more stimulus rather than less. You want a tailwind going into the leadership change and a tailwind coming out.”
At 5:03 p.m. (EDT), the APMEX Precious Metals spot prices were:
- Gold, $1778.70, Up $26.10.
- Silver, $34.67, Up $0.73.
- Platinum, $1,651.40, Up $15.20.
- Palladium, $636.00, Up $9.20.
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