Morning Gold & Silver Market Report – 4/29/2013

Geoffrey Varner

4/29/2013 8:25:00 AM

WILL ECB CUT RATES?

It’s been five years since the onset of the global financial crisis, and since then, economies have been conditioned to rely upon their central banks for stimulus. The eurozone is in recession, and momentum is building for the ECB to cut interest rates this week. If the bank does cut rates, it would be the first time since July 2012. If they don’t cut rates, a cut in June is almost a certainty. Stephen King, global chief economist for HSBC in London, said, “I would argue that the ECB should be thinking of easing policy; whether they are currently is more debatable.” The main factor King sees is what is affecting Germany. Germany is being affected by weakness in Southern Europe and slowing growth in China as well as the depreciation of the Japanese Yen.

Gold added back more than one percent of its value in overnight trading as the U.S. dollar weekend against a basket of six major global currencies. A weaker dollar often helps support commodity prices by making them cheaper for holders of other currencies. At the same time, strong physical demand has encouraged one HSBC economist to write that India’s Gold “love affair” was likely to increase the volume of the country’s imports after the recent slump in prices. Gold isn’t the only metal on the rise; Silver rose 2.3 percent while Platinum added 1.4 percent.

At 9:00 a.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1,471.50, Up $15.40.
• Silver, $24.25, UP $0.40.
• Platinum, $1,507.50, Up $29.10.
• Palladium, $694.80, UP $10.80.

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