The rally in the price of gold and broader markets was fueled by a sell-off in the U.S. dollar

The gold price, at $1,684 per ounce, hovered near unchanged Tuesday morning. After trading as high as $1,695 overnight, the price of gold retreated after German Chancellor Angela Merkel’s chief spokesman, Steffen Seibert, warned that a quick ending to the sovereign debt crisis in Europe was not forthcoming. S&P 500 stock futures turned down on the news while cyclically-sensitive commodities, such as oil and copper, pared their gains.

The rally in the price of gold and broader markets was fueled by a sell-off in the U.S. dollar, particularly against the euro. The euro climbed from near 1.36 to 1.3870 against the dollar last week amid reports that European policymakers are considering an expansion of bailout funds to help recapitalize the euro zone banking system. Speculation that the International Monetary Fund (IMF) may play a larger role in the efforts also arose in recent days. Any increase in the level of financial assistance would inherently involve additional money printing, and thus provide a more favorable environment for the yellow metal.

Despite its advance, the spot price of gold remains 12.6% below its $1,921 all-time high print, recorded on September 6, 2011. Commenting on the yellow metal’s correction over the past month, Tony Hall of Duet Commodities Fund stated in a recent Bloomberg interview that “the decline is more of a healthy retracement” than a change in the long-term trend. ”I do think the trend is still in place,” Hall asserted, “and in the next three to six months we’re going to reach the $2,000 mark.”


Related Posts Plugin for WordPress, Blogger...

KLSE Info Zone

About This Blog

Malaysia Gold Investment

I found Gold Investment in Malaysia is a vary good tools to make profit when the market is down. I also found that Gold Price go up and down more slower compare to share market so to make money in long term, Gold is the right tools. This blog is all about Malaysia Gold Info and the way to make profi

Blog Malaysia


  © Free Blogger Templates 'Greenery' by Ourblogtemplates.com 2008

Back to TOP