PLATINUM BOOSTS GOLD; FITCH WARNS ON DEBT CEILING
Gold is higher this morning, thanks in large part to Platinum. Since the world’s top Platinum producer reported output would be cut by 400,000 ounces, Platinum’s price has overtaken Gold’s for the first time since March; however, it is seemingly boosting Gold’s appeal as well. Saxo Bank vice president Ole Hansen said, “Platinum is the main driver … [but] Gold is also being supported by the fact that we have now managed to close above 200 day simple moving average for a third day.” Hansen went on to talk about other factors in Gold’s price. “The debt ceiling debate should also offer some support as it once again raises the risk that U.S. growth could be hurt. Gold is all about re-building confidence and the last few days have done just that.”
Rating agency Fitch sent a stark warning to U.S. policymakers in a statement this morning, calling the debt ceiling “an ineffective and potentially dangerous mechanism for enforcing fiscal discipline. It does not prevent tax and spending decisions that will incur debt issuance in excess of the ceiling while the sanction of not raising the ceiling risks a sovereign default and renders such a threat incredible.” The debt ceiling threatens basic principles that has allowed the U.S. to keep its triple-A rating, such as “the country's relative economic dynamism and potential, diminishing financial sector risks, respect for the rule of law and property rights, as well as the exceptional financing flexibility that accrues from the global benchmark status of U.S. Treasury securities and the dollar.”
At 9 a.m. (EST), the APMEX Precious Metals spot prices were:
- Gold, $1,683.10, Up $11.70.
- Silver, $31.26, Up $0.11.
- Platinum, $1,693.60, Up $35.40.
- Palladium, $708.50, Up $4.20.
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