Morning Gold & Silver Market Report – 07/02/12
CENTRAL BANK CONSIDERS RECLASSIFICATION OF GOLD BULLION
The United States Federal Reserve Bank released a memo on June 18, which calls for the reclassification of Gold from a 50% weighting to a 100% weighting. Currently, for every $1 of Gold held by the banks or central banks, only $0.50 can be claimed as book value. By changing Gold to a 100% weighting, it would retain full value just like other financial investments. This would enhance Gold’s appeal to the banking community and possibly drive up demand.
Friday’s stock market jump was a reaction to news that European leaders are going to come up with a viable bailout plan. Although this was welcome, it is still a bailout and the European economies are still desperately struggling. American companies are affected as well, and this is expected to be seen in the upcoming earning reports. Many American companies are issuing warnings and they site Europe as a key factor for their disappointing numbers. Second quarter reports will show the euro debt crisis, weak European demand, decline of the euro and the impact of these factors on the overall global economy will all affect the earnings of many U.S.A. firms.
At 9 a.m. (EDT) the APMEX Precious Metals spot prices were:
- Gold, $1,594.50, Down $11.20.
- Silver, $27.53, Down $0.15.
- Platinum, $1,439.50, Down $11.40.
- Palladium, $580.90, Down $4.70.