Mid-Day Gold & Silver Market Report – 2/11/2013

Ted Prince

2/11/2013 12:00:00 PM

GOLD TO EXPECT SECOND HALF BOOST ON GLOBAL CURRENCY WAR?

Gold and Silver are trading lower today as concern over currency competition has weighed heavily on commodities markets. Investors are awaiting a statement from the Group of 20 nations (G20) who are meeting this week to discuss global exchange troubles. Along with the United States’ quantitative easing strategy, many nations throughout the world have adopted similar programs aimed at devaluing currencies in an attempt to compel growth. Stimulus measures have been integral in driving up the Gold price in recent years. The competitive nature of global currency devaluation has caused many analysts to predict a spike in the gold price during the second half of 2013. "We think a currency war will be the biggest story of 2013 when we look back on the year," Patrick Armstrong, managing partner at Armstrong Investment, told CNBC on Monday. "The G20 meeting I think is going to focus on what people are doing with their currencies, trying to gain an edge with currency manipulation. Whenever that's the backdrop, gold has a place in the portfolio."

Equities markets halted today as investors focus on this week’s speech from President Obama over legislative priorities and leaders convene in Europe to discuss the ongoing financial crisis in the region. Following the notable rally that stocks have experienced at the start of this year (the S&P 500 has gained 6.4 percent), it is not surprising to many that the market is taking a breather. “With the strong start this year, it’d be very understandable if stocks pause here,” said James McDonald, chief investment strategist at Northern Trust Corp. “The focus is going to be what the private sector can do to generate growth,” he said. “Investors will be looking at what is the shape of the policy initiatives that are out of Washington, what will Obama focus on, and then secondly, how well Europe deals with the financial crisis.”

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

• Gold, $1,648.50, Down $19.30.
• Silver, $30.95, Down $0.53.
• Platinum, $1,694.70, Down $20.00.
• Palladium, $760.00, Up $7.50.

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