Morning Gold & Silver Market Report – 10/2/2013
SHUTDOWN OR NO, DEBT CEILING STILL LOOMS
The second day of the U.S. government shutdown has now affected the U.S. dollar, driving it down and giving support to the Gold price. U.S. Treasury Secretary Jacob Lew reiterated his previous statements regarding the debt ceiling, saying that the country will have a mere $30 billion cash on hand on October 17. Lew said, “If we have insufficient cash on hand, it would be impossible for the United States of America to meet all of its obligations for the first time in our history.” The ADP private-sector jobs report was released this morning, showing a gain of 166,000 jobs, about 14,000 less than expected. If the government shutdowns continue, the Labor Department’s monthly jobs report will not be released Friday.
Societe Generale analyst Robin Bhar said that rumors were swirling regarding a hedge fund liquidating its Gold position yesterday, causing the sharp decline in prices. This caused a sort of domino effect. While noting that nothing has been confirmed, Bhar said, “There have been some rumours that a hedge fund was liquidating heavily and then once prices fell through $1,300 you just got the technical sellers coming in.” Some typical Gold support is absent, as China is out of the markets for the National Day holidays through October 7.
At 9 a.m. (ET), the APMEX Precious Metals spot prices were:
- Gold, $1,304.50, Up $16.40.
- Silver, $21.46, Up $0.26.
- Platinum, $1,389.70, Up $5.90.
- Palladium, $716.50, Down $2.50.
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