GOLD DROPS MORE THAN ONE PERCENT; OUTLOOK FOR 2013
Today’s Gold market ended at its lowest point since November 4, dropping more than one percent of its total value. There have been multiple factors that attributed to the move, such as the United States’ inability to deal with the budget crisis and the major sell-off of Gold by investors in the past week. However, some believe this has been in the making for much longer. “You cannot attribute this kind of volatility to any sudden, new fundamentals. There are obviously some large fund-algorithmic-type players moving the market around,” Bill O'Neill, partner at commodities investment firm LOGIC Advisors, said.
While the European economic outlook has remained bleak this entire year and beyond, the euro has made a comeback. Today the euro hit a seven week high against the U.S. dollar for two main reasons. First is the uncertainty of the U.S. government’s ability to avoid the fiscal cliff at the end of the calendar year. Second is the announcement of the terms of the Greek debt buyback program. The economic issues in Greece have been well documented and many believed it was a lost cause. However, Greece announced they would be spending more than previously expected by market experts. “The market is taking a fairly optimistic view that we will see a smooth implementation of these (Greek) plans,” said Ian Stannard, head of European FX strategy at Morgan Stanley in London.
All the uncertainty in the U.S. economy has left most people wondering what 2013 will bring. One leading U.S. economist believes the outlook is sluggish at best. “There is an element of repetitiveness in being an economist these days, because adjustments that affect the economy are all very long-term and are not going to change anytime soon,” says Joshua Shapiro, chief U.S. economist at New York-based forecasting firm Maria Fiorini Ramirez, Inc.
At 5 p.m. (EST), the APMEX Precious Metals spot prices were:
- Gold, $1699.10, Down $22.00.
- Silver, $32.98, Down $0.76.
- Platinum, $1588.20, Down $26.60.
- Palladium, $682.80, Down $8.50.
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