Morning Gold & Silver Market Report – 11/30/2011
WORLD’S CENTRAL BANKS COOPERATE TO HELP ECONOMY
In early-morning trading, precious metals are gaining on good economic news. U.S. private-sector jobs grew by 206,000 for November, well above estimates. Global central banks reached an agreement to lower dollar-swap ratios to “ease strains in financial markets and thereby mitigate the effects of such strains on the supply of credit to households and businesses and so help foster economic activity,” according to a statement released simultaneously by the U.S. Federal Reserve, the European Central Bank, the Bank of England, the Bank of Japan, and the Swiss National Bank.
For the first time in almost three years, China’s central bank cut the reserve requirement ratio (RRR) for its commercial lenders. The hope is that the move will ease credit strains and strengthen an economy which is showing signs of weakening. “It's a surprising move; the market was not expecting the central bank to (cut RRR) so fast,” said Shi Chenyu, an economist with the investment banking unit of Industrial and Commercial Bank of China. China currently is like the engine powering the world’s economic car; keeping China’s economy strong is good for the Chinese people and for the rest of the world.
In the eurozone, talks continued among European Union finance ministers who are meeting in Brussels, Belgium. They are trying again to put a cap on the crisis. European Council President Herman Van Romuy said, “The trouble has become systemic. We are witnessing a full-blown confidence crisis.” Also, some international companies are creating backup plans in the case of a eurozone breakup. Andrew Morgan, president of Diageo Europe, said, “We’ve started thinking what it (a breakup) might look like. If you get some much bigger kind of … change around the euro, then we are into a different situation altogether. With countries coming out of the euro, you’ve got massive devaluation that makes imported brands very, very expensive.”
At 8:06 a.m. (CST), the APMEX precious metals spot prices were:
- Gold - $1,747.70 – Up $30.80.
- Silver - $32.61 – Up $0.67.
- Platinum - $1,558.30 – Up $16.60.
- Palladium - $620.00 – Up $35.80.