G20 STATEMENT LEAKS; GOLD AT SIX-MONTH LOW
Gold and Silver prices are adding to losses this morning as reports of the Group of 20 nations statement have leaked. According to a draft statement, the G20 will vow not to devalue currencies in a competitive manner (like the “currency wars” that have been buzzed about lately), and also to monitor “monetary-policy spillover.” Historically, devaluing currencies have been bullish for the Gold price. Bank of America-Merrill Lynch analyst Michael Widmer said, “People are certainly looking at the G20 meeting and the statement, as currency talks may become a strong focus for the Gold market going forward.”
The Gold price hit a six month low this morning, and MKS Capital seems to have an explanation. “The market now seems to be getting used to the more positive frame of mind of a recovering U.S. economy, which entails lower probability of continued [quantitative easing] and in turn a lower Gold price,” the firm said in a note. One key factor in recent price movements is that the euro is weaker against the dollar, which has typically resulted in a falling Gold price.
At 9 a.m. (EST), the APMEX Precious Metals spot prices were:
- Gold, $1,615.00, Down $21.40.
- Silver, $30.05, Down $0.36
- Platinum, $1,680.10, Down $30.80.
- Palladium, $756.10, Down $8.90.
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