-- Posted Monday, 30 April 2012 | | Disqus
New York closed Friday at $1,662.20 and opened the same in Asia and London. The euro was steady at €1: $1.3234. Today, gold Fixed it at $1,662.5 and in the euro at €1,256.614, while the euro stood at €1: $1.3234. Ahead of New York’s opening it stood at $1,662.75 and in the euro €1,257.99 while the euro was at €1: $1.3217.
Silver was$31.23 in London’s morning . Ahead of New York’s opening it stood at $31.20.
Gold (very short-term)
Gold’s trading range should narrow further, with a weaker bias, in New York.
Silver (very short-term)
Silver’s trading range should narrow further, with a weaker bias, in New York.
Price Drivers
Another Monday and another episode in the long running series on the Eurozone debt crisis. This week has started off with expectations that Spain has entered a double-dip recession. Late week ended with Spain’s 10-year yield climbed as high as 6% April 27, bringing the gain this year to almost a percentage point. The notes yielded 5.88% this morning in London. It seems that Spain is moving inexorably to a bailout request, possibly early next year. When Spain and Greece and Ireland had their own currencies and when a ‘run’ on their bank’s capital occurred, such as we have seen in the last few years, exchange controls would have been imposed to prevent such a flight. The country would have struggled for a few years, experiencing an internal boom as import replacement countered any sanctions they might have experienced. But in the Eurozone capital flight has been uncontrolled, draining €65 billion from Spanish banks in March this year alone. They owe the ECB around €318 apart from trade deficits. The capital flows into other currencies or to the economically sounder members of the Eurozone. It is this type of flight added to the inability of Spain to balance its books as the recession hits, that makes the situation so intractable.
What is remarkable is that the euro: dollar exchange rate is seeing a tightening in the trading range. The same as we are seeing in the gold and silver prices, ahead of a large move, either way. [To follow our weekly commentary, please subscribe to our newsletters at www.GoldForecaster.com and at www.SilverForecaster.com.]
Behind the scenes, back in the gold market, the relationship between central bank demand and ‘other’ demand is creating a formula that has changed the shape of the gold market for the foreseeable future. This change is not being reflected in the day-to-day realities of the gold price. We will shortly provide subscribers to our newsletter with an analysis of how the two types of demand will change the dynamics of the gold price.
Regards,
Julian D.W. Phillips for the Gold & Silver Forecasters
Global Gold Price (1 ounce) |
| Today | 1 day ago |
Franc | Sf1,511.69 | Sf1,503.05 |
US | $1,662.75 | $1,655.25 |
EU | 1,257.99 | €1,250.76 |
India | Rs.87,685.12 | Rs.87,045.46 |
-- Posted Monday, 30 April 2012 | Digg This Article
| Source: GoldSeek.com
