Comex gold futures are slightly higher this morning setting new five month highs. Gold and silver prices shot upwards after Fed Chairman Ben Bernanke seemed to open the door to QE3 in his speech last week from Jackson Hole. Now, markets are focused on the monthly meeting of the European Central Bank, which takes place on Thursday. Many analysts expect the ECB will announce a monetary stimulus plan that will boost both stocks and precious metals.
Adding more pressure to the ECB, Moody’s Investors Service changes its euro zone outlook to negative. Moody’s warns that if they cut the ratings of the European Union’s four biggest budget backers: Germany, France, the U.K. and Netherlands, they might just downgrade the entire bloc.
The U.S. and Europe may not be the only economies on the verge of receiving a stimulus. Although the Chinese government has yet to implement any stimulus measures in the face of a slowing Chinese economy, there is additional evidence that their economy is slowing. On Saturday, the official manufacturing-sector survey came out 49.2 in August. This falls below the level of 50 that separates expansion from contraction. In another survey more focused on small to mid-size business, published by HSBC, the number was 47.6.
At 9AM EDT the APMEX precious metal prices were:
- Gold price – $1,691.70 – up $5.60
- Silver price – $32.20 – up 76 cents
- Platinum price – $1,558.10 – up $19.80
- Palladium price – $640.80 – up $11.40