-- Posted Monday, 27 February 2012 | | Disqus

The week opened in Asia with gold standing at the same level as New York closed at $1,772. London then tended to pull it lower just ahead of its opening. The euro is now rising strongly at €1: $1.3455 up just under a cent. In London, gold Fixed at $1,765.00 and in the euro at €1,316.182. The euro weakened slightly in front of New York’s opening.  Ahead of New York gold started to climb again through $1,767.75 and in the euro to €1.318.28.

Silver opened in London over $35.37 holding onto its gains strongly. Ahead of New York’s opening it stood at $35.20.

Gold _{(very short-term)}

Gold will show a mixed to weaker bias, in New York today.

Silver _{(very short-term)}

Silver will show a steady level, in New York today.

Price Drivers

The markets are taking the Greek bailout as a done deal now. Standing back from the story, it is becoming much clearer now that politicians can agree anything they want, but cash flow may well prove more powerful. One of Germany’s opposition leaders reflected these thoughts when he suggested Greece should leave the Eurozone, because it will return for more help as it is realized that austerity has deeply harmed cash flows to the government and they won’t be able to cover the much lower costs they now have.

Attention must now move to building more buffer funds to protect against Portugal and Spain following Greece. The banks have had time to re-capitalize with cheap E.C.B. funds, which came indirectly from the U.S. [Swaps]. So preparations, to guard against more money storms, have been made. The banking system is liquid [and will be kept so, not matter the cost] and the G-20 has told Europe to put up more of its own money to firewall itself. Does this cure the disease, no!  Growth may, but meantime the fundamentals for gold improve steadily. [To get more of the right perspectives on the gold and silver markets and where gold and silver prices are going, subscribe through www.GoldForecaster.com or www.SilverForecaster.com].  The test will come, inevitably, to see if confidence lies in governmental moves to repair the system or overwhelming realities show these as insufficient. Where are you putting your money? As insurance, we can see gold acting more visibly in government finances [as we saw in Greece]. This is not a matter of choice by governments but a reflection of need, as extreme times start to spread in different parts of the world. The developed world is not immune to this.

Meanwhile, Asian demand for gold has slipped slightly in the short-term, but silver demand is increasing there.

Regards,

Julian D.W. Phillips for the Gold & Silver Forecasters

-- Posted Monday, 27 February 2012 | Digg This Article | Source: GoldSeek.com

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