EURO TROUBLES, “FINANCIAL ARMAGEDDON” SUPPORT GOLD
Precious Metals are continuing their climb this morning, with Silver reclaiming $35 per ounce and Gold topping $1,790. An early boost came with news that the European Central Bank would hold steady on interest rates again, at 0.75 percent, with a zero percent interest rate on its deposit facility. ECB President Mario Draghi said at his monthly press conference that the eurozone’s recent bond buying plan has eased regional tensions. He also repeated earlier statements that the euro is “irreversible.”
Metals prices also received a boost when the weekly jobless claims report was in line with expectations. Businesses seem to be wary of hiring because of the “fiscal cliff,” which could occur by year’s end if tax hikes and government spending cuts aren’t avoided by Congress. This week’s jobless claims rose by 4,000 after a higher adjustment to last week’s numbers.
Many economists believe the sentiment is going back to Gold being a safe haven investment. Sharps Pixley Director Austin Kiddle said, “There are a lot of people out there talking of financial Armageddon and even with seemingly neutral announcements, this can make investors prepare for the worst. $1,780 was an important number to breach and with the U.S. dollar rising due to recent positive data, it has given Gold a strong headwind instead of the normal inverse relationship that Gold and the dollar normally have.”
At 9 a.m. (EDT), the APMEX Precious Metals spot prices were:
- Gold, $1,787.40, Up $8.60.
- Silver, $34.75, Up $0.07.
- Platinum, $1,703.60, Up $12.50.
- Palladium, $664.20, Up $5.30.
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