Closing Gold & Silver Market Report – 10/23/2012
GOLD STAYS DOWN; MONETARY EASING DEVELOPMENTS
Gold has seen a significant dip in price today. With any strong movement in prices there is usually an underlying cause, and today that has been the struggles of the European economy. Spain has had their credit rating downgraded and has fallen behind in their debt reduction plans. The news has caused the euro to lose value and in turn has added value to the U.S. dollar. However, there are indications this may be a temporary dip in Gold’s market value. "It's a confluence of markets. With equities off so much, typically when we see a big drop in equities there's sort of a knee-jerk reaction that brings Gold down for a while before Gold picks up in response to the weaker equities," said Jeffrey Nichols, senior economic adviser at Rosland Capital. "So it may be playing through that game once again."
Last month all the talk was surrounding economic stimulus deals being set in motion by the world’s leading central banks. This month the issue has become whether the banks have done enough to stimulate growth. This week U.S. Federal Reserve members are discussing plans that could add more stimuli to the national economy. While there may be talk, most economists believe it will not go into action right away. "The Fed has entered a holding pattern while watching for signs of a substantial improvement in the labor market," said Ellen Zentner, senior U.S. economist for Nomura Securities.
At 5 p.m. (EDT), the APMEX Precious Metals spot prices were:
- Gold, $1,708.40, Down $17.90.
- Silver, $31.70, Down $0.57.
- Platinum, $1,571.80, Down $37.90.
- Palladium, $595.80, Down $27.90.
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