CENTRAL BANKS’ ACCRUAL OF GOLD BULLISH FOR LONG-TERM INVESTORS
Precious Metals are trading flat today even as the dollar has slipped slightly against the euro following European Central Bank (ECB) President Mario Draghi’s reassuring statements regarding the eurozone’s economic condition. Draghi confirmed that the ECB is predicting modest growth by the end of 2013. He went on to state that loose monetary policy will continue until significant economic improvement is realized.
Though risk tolerance among many investors has increased on the headwinds of positive U.S. economic data and record stock prices, other experts are still bullish for Gold due to the substantial accumulation by central banks. “When you see central bankers acquiring Gold, you can kind of take it like this: You don't fight in the stock markets when the Fed (U.S. Federal Reserve) is easing, so you wouldn't want to fight the central banks when they're buying Gold, because they have deep pockets," Philip Silverman, managing director at Kingsview Management in New York, said. Silverman went on to assert that the recent price dip is due to nervous investors bailing out of Gold on the heels of such a strong rally in equities markets. The continued buying by central banks along with ultra-loose monetary policies from nations around the world are both extremely supportive of long term Gold prices.
At 1:01 p.m. (EST), the APMEX precious metals spot prices were:
- Gold, $1,577.50, Up $0.60.
- Silver, $28.83, Down $0.03.
- Platinum, $1,597.20, Up $15.40.
- Palladium, $758.00, Up $18.90.
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