Gold & Silver Prices Slightly Off in Morning Trades

Markets continue to monitor news coming out of the euro zone. Greece wants a new deal with less austerity, but there are no signs Germany is willing to give in. Of course, Greece is not the only problem. Investors will watch Spanish banks for any signs of additional weakness. There are those who are concerned there could be runs on the banks.

Euro zone leaders will meet informally in Brussels this week and French President Francois Hollande is expected to propose the idea of a Eurobond. A Eurobond would be jointly underwritten by all euro zone members. Germany is reluctant to support such a measure until other member states have their financial houses more in order. If these bonds were to written, it would place Germany in a position of financing the debt of other states.

The leaders of the G-8 met over the weekend at Camp David. They all agree that Greece should stay in the euro zone and they all agree “on the importance of a strong and cohesive euro zone for global stability and recovery.”

The continued uncertainty in Greece has caused the euro to give up the small gains it had achieved against the dollar. This largely accounts for the weak openings for gold and silver.

At 9AM EST the APMEX precious metal prices were:

  • Gold price – $1,589.20 – down $4.20
  • Silver price – $28.31 – down 48 cents
  • Platinum price – $1,461.80 – up 50 cents
  • Palladium price – $613.30 – $7.70
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Gold Ends Higher for the First Day in Five

After closing lower for four consecutive trading days, gold prices rebounded today after hitting a 10-month low.

Oil prices continued to decline today, providing some welcome relief to American consumers. “We had soft economic data and European concerns weighing on equities and oil is being pulled along lower,” said Jason Schenker, president of Prestige Economics LLC. “Elevated concerns about the European story and disappointing U.S. economic data have been the story for two weeks now.”

Moody’s is set to announce downgrades of several Spanish banks this evening. According to a source with knowledge of the issue, the key reasons for the downgrades are rising loan defaults, a renewed recession, restricted funding access and the reduced ability of the government to support lenders. The Spanish newspaper El Mundo reported yesterday that customers of the Spanish bank Bankia SA had withdrawn more than 1 billion euros from the bank since the government announced it was taking over the bank on May 9. Bankia SA and the Spanish government denied that a bank run was underway, but markets hammered Bankia’s share price nonetheless.

Ahead of tomorrow’s G8 summit at Camp David, Barack Obama is urging European powers to ease austerity policies and adopt a growth strategy. The newly elected president of France, François Hollande, is expected to support Obama’s argument. Hollande defeated incumbent Nicolas Sarkozy by campaigning against austerity measures, which are deeply unpopular in some European countries.

At 5 p.m. (EDT), the APMEX Precious Metals spot prices were:

  • Gold – $1,575.20 – Up $37.10.
  • Silver – $28.08 – Up $0.80.
  • Platinum – $1,454.00 – Up $19.80.
  • Palladium – $604.00 – $7.90.
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