Mid-Day Gold & Silver Market Report – 7/18/2011
GOLD RISES WHILE STOCKS DROP AMID CONTINUING DEBT FEARS
U.S. stocks have seen a sharp drop in morning trading, primarily caused by the ongoing fears investors have over the failure by U.S. policymakers to raise the debt limit, as well as the uncertainty that still surrounds the debt crisis in Europe. Those same fears helped gold futures to rise above last week’s record high of $1,590.10/oz. to over $1,600/oz. so far today, as investors continue to look upon gold as a financial safe haven. The price of gold has risen over 7% in July.
Discussions on raising the U.S. debt limit continue to show a distinct lack of progress. This week, Senate Republican Leader Mitch McConnell and his Democratic counterpart Harry Reid plan to introduce legislation that would enable the President to raise the debt ceiling three times over the coming year in exchange for deep spending cuts over the next decade. At the same time, Republicans in Congress will be voting tomorrow on a similar bill that raises the debt ceiling and requires spending cuts, but also amends the Constitution with a balance budget amendment. Even if this bill passes through Congress, however, it is not expected to pass the Senate.
Although news of the U.S. debt ceiling has monopolized the headlines as of late, it does not take away from the continuing crisis in the Eurozone. Pimco’s Neel Kashkari told CNBC today that a plan of “overwhelming force to let the markets know that once and for all you’re putting out the fire” in Europe should be to let Greece, Portugal and Ireland default.
At 12:00 am (CT) the APMEX precious metals spot prices were:
- Gold - $1,605.20 – Up $14.10 on the day.
- Silver - $40.40 – Up $1.27.
- Platinum - $1,772.80 – Up $17.30.
- Palladium - $795.60 – Up $12.90.