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Gold Nears €1,300/oz - Euro Lower After EU Downgrades and Greece Jitters
From GoldCore
Gold Nears €1,300/oz - Euro Lower After EU Downgrades and Greece Jitters
Gold’s London AM fix this morning was USD 1,643.50, GBP 1,074.60, and EUR 1,298.90 per ounce.
Friday's AM fix was USD 1,642.00, GBP 1,070.27, and EUR 1,281.71 per ounce.
Spot gold is again above the 200 day moving average near $1,638/oz. Gold prices have rallied 5% so far in 2012, with the eurozone debt crisis and the growing tension between Iran and the west supporting gold's safe haven status.
Cross Currency Table - Bloomberg
Although gold had its largest drop in the last 2 weeks on Friday, (-1.6%), it was 1.3% higher on the week and trading higher this morning. Many analysts feel that current sovereign, macroeconomic and geopolitical risks are not reflected in gold's price.
Friday's news of France's loss of its AAA rating has put the European Financial Stability Facility (EFSF) at risk. The Eurozone economy resembles a large ship sailing in rough seas since France fund's 20% of the EFSF fund and 8 other members were also downgraded.
Gold XAU-USD Rate - G14 Daily - Bloomberg
This will almost certainly lead to the EFSF's downgrade which would result in the fund too paying more to borrow as credit costs rise. There are icebergs lurking in increasingly murky Eurozone waters. The European downgrades were long expected and may have been priced in the markets. The risk of a non orderly Greek default and of contagion in the Eurozone remains and is not priced into markets. It would lead to the euro falling sharply against other fiat currencies and particularly against gold.
XAU-EUR Rate G14 Daily - Bloomberg
Gold has risen 7.4% in euro terms in the first two weeks of the year. Gold at €1,298/oz today is less than 4.7% from its record high in euros of €1,359/oz (09/09/11). Given the scale of the crisis, new record highs in euro terms could be seen in the near future.
The situation with Iran is also likely to support gold prices. Crude oil prices remain near recent highs due to concerns over supply disruptions - after Iran warned Arab countries of consequences if they raised oil output to replace Iranian production facing international sanctions.
Gold jewellery demand in India has risen from 5 to 7 % in 2011, and is projected to grow another 10 to 15 percent this year said the head of India's largest jewellery retailer confirmed on Sunday.
UBS saw an increase in physical gold demand last Friday to the highest so far in 2012 confirming that India is a buyer at these levels although Reuters report that demand was more lack lustre in India overnight.
This strongly suggests that demand in India is more robust and less sensitive to higher prices than the bears have claimed. The Indian sub continent continues to buy the dip.
For breaking news and commentary on financial markets and gold, follow us on Twitter.
NEWS
(Reuters)
Gold steady after S&P downgrades; dollar pressures
(MarketWatch)
Gold futures gain in Asian trading
(Reuters)
Indian gold jewellery demand seen up 10-15 pct in 2012
COMMENTARY
(The Telegraph)
The French downgrade should be a warning about hidden UK liabilities
(CNBC)
http://www.cnbc.com/id/45989663 ">Faber: US Should be BBB or Junk ... Hold Gold
(Mineweb)
Rapid rise to $10,000 gold 'strains credibility'
(ZeroHedge)
How Safe Are Central Banks? UBS Worries The Eurozone Is Different
(The NY Sun)
Secrets of the Fed
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Bill Gross says it is time:
http://www.bloomberg.com/news/2012-01-16/gross-greece-to-default-followi...
well, end of 2010 or so I was quite sure Greece would default around Summer 2011 - my fault
More Greece will imminently default and crumble the EURO eh....
As you correctly mentioned.....we HAVE heard this one (wrongly) many many times before.....YAWN!
Well it's great news if you're holding Euros.......I'm not touching that crap.
I'm not even sure I want to be holding dollars. So the dollar benefits....what the hell does that mean? It's like the Olympics of mediocrity.
Not exactly a shocker Gene. What I find shocking is that gold is still trading sub 1300 to that crap euro and the soon to be crap drachma. Forgive me for not following Gross's lead and piling into UST. I think gold can trounce a 4% return this year with little to no downside risk at these levels.
owwww... this is going straight in a better ECB balance sheet situation
well, Central Banks are stacking, so I...
Anybody with euro savings should buy about 99% of their assets in gold and silver bullion.
just to play it safe....
and premiums are going through the roof here. Better buy the numi gold coins.
check? check! (and get some Ravioli!!)
I'm more of a Macaroni/ham/cheese kind of guy but I know what you mean!
Hear, hear. Too bad last month's short term gold sale was limited to USD alone.
EFSF: European Fantasy Scam Fund.
<€30 million in subscribed share capital, with no idea of how much is paid up. Must be a reason it's a limited company registered in Luxembourg.
€780bn "fund" is no more than bunch of worthless promises. I mean Spain and Italy are on the hook for 30% of these promises between them.
At least bonds issued by EFSF are acceptable at the ECB.
"It would lead to the euro falling sharply against other fiat currencies and particularly against gold."
Which doesn't preclude the $ price of gold falling quite a bit if (when?) TSHTF...
This is absolutely true, but it would be short-lived. Printocchio wants the dollar to be weaker despite the public claims. He just needs some sort of a triggering event to announce that he is going to put the Fed's printers on double secret turbo print rather than the extra fast print he has right now (without telling people this explicitly, though all of us have already read the releases and know this). So, when and if it comes, BTFD. I expected a raid last night with this being a 3-day weekend. Maybe the raid comes tonight. Because gold is kryptonite to the Fed...
Double secret turbo print!!!...Oh...I'm telling....
Bernanke: Prepare printer for light speed.
Money-lenders: No, no, no, light speed is too slow.
Bernanke: Light speed, too slow?
Money-lenders: Yes, we're gonna have to go right to ludicrous speed.
Bernanke: Ludicrous speed? Sir, we've never gone that fast before. I don't know if this printer can take it.
Money-lenders: What's the matter, Colonel Bernanke, chicken?
Bernanke: Prepare printer, prepare printer for ludicrous speed. Fasten all seat belts, seal all entrances and exits, close all shops in the mall, cancel the 3-ring circus, secure all animals in the zoo...
Gold BitcheZ
There, I said it :)
The Eurozone economy resembles a large ship sailing in rough seas...There are icebergs lurking in increasingly murky Eurozone waters.
Someone channelling the Costa Concordia?
The gold paper trade will dominate until you walk into your local coin shop and there's not a 1/10 of an ounce to be had...It's coming...
Anyone know where you can purchase 1oz American Eagle Platinum coins? All the usual suppliers are out of stock.
http://comparegoldprices.com/
And buy some nice Maple Leafs as well. So pretty. ^^
Great link, fall, thanks!
They have been sold out for a while now. I got mine about a month or two ago, and I haven't seen inventory since. Unless, You want to pay a high premium.
Not to mention Platinum maples, Isle of man's, Suisse, or any other
Americans, see this, we're saved! This guy's got it figured out, and he's just an average Joe!! /sarc
P.S. Unreal, the level of LACK of knowledge. Note his dollar figures and the news team's "gold" coins pictured, funny stuff.
http://www.kjct8.com/news/30172361/detail.html
Ya! This guy has it all figured out...The (Mis)information even at the local level pertaining to physical (coin/bar) is unbelievable...Those who take it seriously and read right through this crap deserve what they get...Or don't get...
Who knew it was that easy?
What a moron...
Smith says he sent a letter to President Obama asking him to look into this, but he is still waiting to hear back
Go USA
Go figure ...
OT a bit, but in view of MFG, anyone who thinks they OWN Gold Stocks, would do well to read this if you have not done so already.
The Pillars which have (in most instances past) that have held up under duress, are now not doing their jobs.(read the fine print folks).
Like ETF's, there are always Trap Doors..............
Who Really Owns Your Gold Stocks?
jsmineset.com
Gold Nears €1,300/oz
Well that gave me a mild heart attack. $1300/ounce!!! Headline quote using €uroes, keeps the reader awake I suppose!