Prior to the opening of the New York market, gold is up more than $2.50 to $683.40. Once the New York market opened gold shot up to around $687 and has settled around $685.
The gains are primarily due to the dollar continuing to weaken against both the Euro and the Yen. Today, the dollar hit a two month low against the Yen stemming from the sub-prime fallout, which the market is clearly expecting to continue its negative impact on the dollar. The dollar has fallen to a point where additional sales have been triggered, further reducing its value.
Over the next two days, existing home sales and new home sales for June will be released. Both numbers are expected drop more than 1.5 percent and the number of existing homes listed for sale is expected to increase to its highest levels in 15 years. These numbers should push the dollar downward as the market continues to speculate what the Fed is going to do about the housing market, which has yet to hit rock bottom.
The price of oil has fallen off of its recent highs over the past two days, which could limit gold's gains today. However, tomorrow, U.S. fuel inventories will be reported and should the numbers fall, the price should jump right back up into the $75-$76 range, which we believe will boost the price of gold.
Blanchard and Company, Inc. is the largest and most respected retailer of American rare coins and precious metals in the United States, serving more than 450,000 people with expert consultation and assistance in the acquisition of American numismatic rarities and gold, silver and platinum bullion. The Blanchard Economic Research Unit is a key source of precious metals market analysis and continues to be an important resource for financial and consumer media throughout the United States. Blanchard and its predecessor companies have called the New Orleans area home for more than 30 years. For more information about the company, visit www.BlanchardGold.com
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