-- Posted Tuesday, 29 November 2011 | | Disqus
Asia saw gold remain close to the U.S. closing price around $1,706, but London was not convinced and took the gold price higher to $1,710. But as we have emphasized, it is the London gold Fixing that’s dominating the price. The euro rose from €1: $1.3366 to €1: $1.3425. Then the Fix came in at $1,717.00 and in the euro at €1,278.671 up in the dollar and down in the euro. The price was pushed down to $1,714.60 after the Fix and lower to $1,709 ahead of New York’s opening and in the euro to €1,281.69 while the euro stood at €1: $1.3334.
The silver price held in Asia and in London at $32 right through London’s morning. Ahead of New York’s opening it stood at $31.70.
Gold (very short-term)
The gold price should have a stronger bias in New York today.
Silver (very short-term)
The silver price should have a stronger bias in New York today.
Price Drivers
The Eurozone crisis continues to degenerate as Italy had to pay over 8% for its money, for the third time. This is unsustainable. It is likely that Italy will call for a bailout soon. Add to this the bad news of the last week on Belgium, now France, Germany and now 87 European banks and it is vividly clear that the euro and the Eurozone looks capable of unraveling. Markets are beginning to factor that in.
Commentators appear to have linked the gold price to the euro, because of the flight from the Eurozone of capital and to the dollar. The gold price has certainly been moving against the euro than against the dollar, with the euro itself tending to fall against the dollar. We would not link the euro to the gold price nor to the dollar. Any short-term relationship to currencies looks like being just that. We would agree that investment demand from the Eurozone for gold is stronger than in the U.S. but in both areas jewelry demand is picking up ahead of the festive season. With the London Fixing exerting strong dominance over the gold price physical demand is by far the strongest factor for gold. We should be looking at the concept of gold reflecting the price of currencies rather than the other way around going forward.
This becomes even clearer now that the way forward for both sides of the Atlantic to return to some form of quantitative easing as the remaining way to stimulate economies. It’s just a matter of time! [To get a fuller picture, subscribe through www.GoldForecaster.com or www.SilverForecaster.com to our newsletters on these subjects.]
Today, the European Finance Ministers are meeting, yet again, to look for ways forward. Hopes of something solid coming out of the meeting are scant. Each time they meet and fail to produce real hope, confidence in the euro weakens.
Regards,
Julian D.W. Phillips for the Gold & Silver Forecasters
Global Gold Price (1 ounce) |
| Today | 1 day ago |
Franc | Sf1,573.82 | Sf1,576.83 |
US | $1,709.00 | $1,698.22 |
EU | 1,281.69 | €1,280.87 |
India | Rs.88,910.73 | Rs.88,874.22 |
-- Posted Tuesday, 29 November 2011 | Digg This Article
| Source: GoldSeek.com
