Morning Gold & Silver Market Report – 12/9/2011
NEW FISCAL EU IN THE WORKS
Not all the European Union countries are on board yet, but after overnight talks in Brussels, Belgium, 23 European nations (including all 17 eurozone members) are planning on a new intergovernmental treaty for fiscal discipline. This “fiscal compact” includes caps on Gross Domestic Product deficits, consequences for deficits exceeding 3% of GDP, additional contributions to the International Monetary Fund, and other features. Although German Chancellor Angela Merkel praised the plan, we have yet to see how this or any plan will help EU countries grow their GDP and lower their deficits. U.S. stock futures are gaining on the news coming from this EU summit.
Gold is responding to the European news positively, rising along with the euro. Gold has been moving relative to the euro, and this morning’s news has ended up being positive for the euro. Long term, Gold is still viewed as a safe haven for storing wealth. Oliver Pursche, co-portfolio manager of the GMG Defensive Beta Fund, said, “When you have so much retail and ETF interest (in Gold), you're not going to trade on the fundamentals on the short term. (But I) would not be surprised to see higher Gold prices longer term.”
At 8:10 a.m. (CST), the APMEX precious metals spot prices were:
- Gold - $1,708.90 – Down $2.50.
- Silver - $31.79 – Up $0.27.
- Platinum - $1,496.00 – Up $0.60.
- Palladium - $672.00 – Down $3.30.