Mid-Day Gold & Silver Market Report – 1/23/2012
GOLD PRICES RALLY; EU’S IRANIAN OIL BAN DRAWS RESPONSE
Gold prices are at a six-week high, as the price has increased since this morning. Gold’s rise is coming from Europe’s continued financial predicament and Iran’s threat to stop delivery of crude oil to several countries. Daniel Smith at Standard Chartered said, “Gold is part of a wider rally in commodities and risk appetite.” Commenting on Gold’s correlation with the euro, UBS analysts wrote, “That investors have become friendlier to Gold is clear, but as Gold's correlation with risk and the euro remains strongly positive -- although easing somewhat -- ‘longs’ are likely to remain more tentative than aggressive, given the still-uncertain macroeconomic environment.”
The European Union agreed today to ban crude oil imports from Iran, even as additional economic sanctions may be imposed. The oil import ban would be imposed by July 1. Senior Iranian politician Ali Fallahian fired back, saying, “The best way is to stop exporting oil ourselves before the end of this six months and before the implementation of the plan. If they increase the pressure on our country, we can use the Strait of Hormuz as a tool to decrease the pressures, and closing the strait is one of the options.”
A deal between France and Germany with private-sector investors to reduce Greece’s debt burden was reportedly going well this morning. French Finance Minister Francois Baroin said, “A voluntary restructuring of debt held by private investors … seems to be taking shape. We are determined to support Greece the time necessary for it to put in place reforms and for them to produce their effects.” However, Greece must stick to its promised reforms if it is to secure additional help from the EU and the International Monetary Fund.
At noon (CST), the APMEX precious metals spot prices were:
- Gold - $1,677.60 – Up $11.90.
- Silver - $32.25 – Up $0.50.
- Platinum - $1,562.70 – Up $29.40.
- Palladium - $689.90 – Up $13.20.