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Yesterday gold broke down
through $1,700 in London, where at the morning Fix it was set at $1,698 and
at the p.m. Fix at $1,705. New York was not keen to take it lower where it
held above $1,700 and held there in Asia too. London then let the gold price
fall to $1,685 ahead of the Fix.
At the Fix it was set at
$1,685.50 and in the euro it Fixed at €1,282.237, while the euro was at
€1: $1.3145. After the Fix it started to pick up almost straight away.
Ahead of New York’s opening it stood at $1,690 and in the euro €1,285.07
while the euro was at €1: $1.3152 making the moves about the euro.
Silver was taken down to
$33.79 at London’s opening. Ahead of New York’s opening it stood
at $33.45.
Gold (very
short-term)
Gold is
expected to consolidate with a weaker bias, in New York today.
Silver (very
short-term)
Silver will
consolidate or weaken, in New York today.
Price Drivers
On Monday, Greece’s credit rating was cut to the lowest level by
Moody’s Investors Service. Greece’s long-term foreign currency
debt was downgraded to C from Ca, with
Moody’s saying that investors who participate in the nation’s
debt exchange will get about 70% less than the face value of their holdings.
The deal constitutes “a distressed exchange, and hence a
default,” the company said. We are waiting to see if private holders of
Greek debt will accept the offer. They will have to willingly or unwillingly,
but their issue is to get the Credit Default Swap insurance activated. This
may well cause markets to flutter again.
Meanwhile, a new major issue that could affect the gold and silver
price is the resurgent oil price. Cast you mind back to when the oil price
hit $145 and remember what the global economic conditions were like then and
the impact such prices had in the economy. First, this time round the oil
price will not tumble back to $35, because Saudi Arabia plus the rest of
O.P.E.C. needs $100 oil because they deem it to be their break
even point. Second, the globe will have to decide how high the oil
price is going to go and for how long. If it is purely political [Iran] then
it will stay high as long as Iran remains a threat to oil supplies, from
itself and through the Straits of Hormuz. Listening to the Israeli Prime
Minister this morning, war is just a small step away.
If it is because of demand from China or the cheapening of money
itself through QE [and oil producers don’t accept cheaper money but
raise prices to compensate], then the oil price will stay high!
Gold and silver will more than follow! [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].
Regards,
Julian D.W. Phillips
for the Gold & Silver Forecasters
Global Gold Price (1
ounce)
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Today
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1 day ago
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Franc
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Sf1,558.97
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Sf1,553.41
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US
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$1,698.22
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$1,691.80
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EU
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1,269.22
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€1,262.34
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India
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Rs.88,434.81
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Rs.88,591.11
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