Mid-Day Gold & Silver Report, 5/30/2012

Brandi Brundidge

5/30/2012 12:02:00 PM

GOLD AGAIN GAINS ATTENTION; AMERICAN RECOVERY IN QUESTION  

Gold seems to be keeping up with global events. As the United States dollar gains and the euro falls, Gold prices are being affected. The question is not what has happened in the past, but what the future has in store. There are signs of changes on the horizon, and Gold and Silver prices had started moving up. “People become more aware that the unintended consequence is an environment of negative real interest rates, and the value of cash is worth less,” said Will Rhind of ETF Securities. He added, “This is exactly the kind of environment in which we see hard assets becoming attractive to people.”

All eyes have been on Greece and its economic struggles. It seems Spain might have more pressing issues than its European counterpart. The main issues in Spain revolve around the borrowing cost and the country’s stock market being at a nine year low. There is help being offered by the European Commission. One option is to give Spain an extra year to try to build a solid budget. The other option is to get help from other European countries. Nether option seems to be getting rave reviews.

At a glance, one would believe that America has turned the corner on the way to financial recovery. The dollar’s value is at a two year high, the job market has been improving, and even the housing market has seen some upswing. However, when looking into the numbers, things aren’t always as they seem. Pending home sales dropped in April, which was unexpected. “The drop in pending home sales is clearly disappointing,” said Pierre Ellis, an economist at Decision Economics in New York. “It remains to be seen whether this is the beginning of a real downturn.” The May jobs report is also showing slower than expected growth. Job growth for March and April was much slower than in January and February.

At 1 p.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,565.30, Up $14.80.
• Silver, $28.07, Up $0.19.
• Platinum, $1,404.50, Down $25.60.
• Palladium, $606.50, Up $0.80.

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