Tag Archives: Germany

America waits for further stimulus; how are investors measuring the euro

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Gold fell slightly today with investors taking their earnings after last week’s gains, which was encouraged on the assumption that central banks will provide additional stimulus actions.  “Everybody seems to be waiting for this huge money printing that they think is going to happen which hasn’t happened yet. So, nobody really wants to bet against it, but at the same time they don’t want to go long,” said Doug Roberts, chief investment strategist at Channel Capital Research.

As the European debt crisis continues, it is evident that Europe’s foundation is ultimately taking care of the peripheral countries that have more or less had to be bailed out by the troika of the European Central Bank, International Monetary Fund and European Commission.  The concerns are beginning to rise as the growth numbers for France and Germany are slipping.  Also, for the months of May and June, Germany’s factory orders fell by a disturbing 1.7 percent compared to the forecasted 0.8 percent.  Gerard Lyons, chief economist at Standard Chartered, told CNBC.com. “In the good times, the euro encourages money to go from the core to the periphery, creating booms and busts. In the bad times, it encourages money to go the other way and increases the liabilities of the core.  The euro is a fundamentally flawed concept, and that’s why the core is facing greater challenges. The core can’t cut themselves off completely from the periphery and that’s what markets are responding to.”

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

  • Gold, $1,610.60, Down $10.70.
  • Silver, $27.87, Down $0.31.
  • Platinum, $1,388.50, Down $12.40.
  • Palladium, $574.50, Down $9.20.

 

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Gold Prices Slightly Lower in Overnight Trading

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Gold and equity markets are both poised to advance in the event the European leaders announce a plan to bail out Spain and curb further contagion. Spain has requested further euro zone support in buying its sovereign debt. Germany continues to be resistant to this notion and this does set up a clash of wills as German finance officials prepare to meet with U.S. Treasury Secretary, Tim Geithner. Mr. Geithner has stated that the euro zone crisis is the biggest threat to the U.S. economy, so it is expected he will put pressure on Germany to take additional action.

 

The economic picture in Spain continues to worsen as their recession deepened in the 2nd quarter. Tough new austerity measures were enacted and this did take a toll on overall demand and consumer prices. Consumer prices rose 2.2% year over year. All in all, this paints a difficult picture for Spain to climb out of their budget deficit.

 

European stocks are currently trading higher on the hopes of the European Central Bank stepping in with additional measures, while U.S. stock futures are trading lower as they await potential action.

 

At 9 AM EST the APMEX precious metals prices were:

 

  • Gold price – $1,618.00 – down $2.20
  • Silver price – $27.78 – up 19 cents
  • Platinum price – $1,410.70 – up $2.50
  • Palladium price – $582.50 – up $9.60

 

 

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Precious metals rally on quantitative easing talks domestically, as well as internationally

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Precious metals rally on quantitative easing talks domestically, as well as internationally. Gold in particular is continuing its upward movement as a result of the easing talks. Commodities manager Jeffrey Sherman said, “The gold market has been looking for any hints of any quantitative easing program. You are seeing this big bounce today off the fact that there could be something going on in euroland.” The ECB is potentially going to create new money to help sovereign bailouts within the eurozone, a potential boost to gold prices.

New home sales have fallen, creating a bit of a setback to the nominal housing market recovery. The drop was primarily due to a huge setback in the northeast. Economist Yelena Shulyatyeva said, “Housing will continue to recover gradually throughout the year, but fundamentals are not supportive of a fully fledged housing market recovery.” Meanwhile, fundamental data still suggests a marginal recovery as economist Joel Naroff said, “It is hard to believe that the market is turning downward when the home builders’ confidence index jumped in July to its highest level in over five years. Either developers are clueless or the data have yet to catch up with reality. I am on the side of the latter.”

Meanwhile concerns continue to grow over eurozone debt fears as a number of high ranking officials and even prime ministers are set to hit the European holiday season. After issuing a statement yesterday blasting bond traders for driving up Spain’s borrowing costs, Germany’s Finance Minister Wolfgang Schaeuble is now on a three week vacation. However, Germany’s Schaeuble and Prime Minister Angela Merkel are supported by gains in German bunds markets. The top two German officials’ vacation plans have investors looking elsewhere for crisis management.

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

  • Gold, $1,605.30, Up $27.10.
  • Silver, $27.39, Up $0.49.
  • Platinum, $1,400.40, Up $13.80.
  • Palladium, $566.00, Up $3.40.

APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (EDT)! Or call us Fridays until 6 p.m. (EDT)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help.

 

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Gold Bounces Back Along with the Euro

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Gold is recovering from recent losses along with the euro this morning. A policymaker from the European Central Bank hinted that Europe’s rescue fund could get a banking license, allowing easy access to cheap funding from the ECB. While just a small mention from one policymaker, it has been enough to snap a five-day losing streak for the euro.

Germany, which has long been the strong point in the eurozone, is starting to feel the heat from the rest of the eurozone, said Mike Jones of Bank of New Zealand. Jones said, “The economic weakness in Europe is spreading from the periphery to Germany. Even the engine of European growth is starting to lose steam, and that’s undermining European sentiment.”

The United Kingdom is also in a bad spot. Nick Parsons of National Australia Bank in London said that, by the end of the year, he expects an interest rate cut in the country and “more quantitative easing is going to be needed.” The U.K.’s economy shrank more than expected in the second quarter, showing that Britain has “deep-rooted economic problems,” Finance Minister George Osborne said.

At 9 a.m. (EDT), the APMEX Precious Metals spot prices were:

  • Gold, $1,602.40, Up $24.60.
  • Silver, $27.34, Up $0.44.
  • Platinum, $1,403.60, Up $17.00.
  • Palladium, $567.60, Up $5.10.

APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (EDT)! Or call us Fridays until 6 p.m. (EDT)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help.

 

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Credit Outlook Dims for Germany; U.S. Fiscal Cliff Looms

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Precious metals continue to hold firm in the serious head winds afflicting other commodities markets. Gold in particular has been relatively range bound but in the current market conditions, that’s not an entirely bad thing. Analyst Hayden Atkins said, “Markets sold off really heavily yesterday, and gold held up pretty well against that. It is maybe the one thing that has really stayed solid against some pretty solid headwinds elsewhere.” Meanwhile the issues facing the euro have actually helped Gold in the eurozone as evidenced by Commerzbank’s note to investors which read, “Thanks to the euro’s depreciation vis-a-vis the U.S. dollar, gold in euro terms has been making gains for some time now. Since mid-May an upswing has become evident which in the current market environment should take the yellow metal on a further upward trajectory.”

Meanwhile Moody’s downgraded the credit outlooks of a few of the remaining Aaa rated countries in the eurozone. Those countries are Germany, the Netherlands and Luxembourg. Basically the main countries that would provide assistance to other countries in the region that may need financial assistance. The service released a statement saying, “Moody’s now has negative outlooks on those Aaa-rated euro-area sovereigns whose balance sheets are expected to bear the main financial burden of support — whether because of the need to expand the European Stability Mechanism (ESM) or the need to develop more ad hoc forms of liquidity support.”

U.S. Treasury Secretary Timothy Geithner has already begun speaking towards the potential outcome of kicking the can down the road with the current fiscal situation. In an interview yesterday he said, “Many people who look at this say that, yes, you’d at least get a recession out of this. The cumulative size of those cuts – tax increases and spending cuts – are very, very large relative to the economy.” He also warned that any governmental failure could be quite damaging, relating it to the negative impact of losing the U.S. credit rating last year over debt ceiling talks. He said, “You saw huge damage to consumer confidence, to business confidence, and to confidence around the world in the United States because you had people in public office threatening to default on our nation’s obligations.”

At 9:00 a.m. (EDT) – the APMEX Precious Metals spot prices were:

  • Gold, $1,579.90, Up $1.00.
  • Silver, $27.06, Down $0.08.
  • Platinum, $1,397.60, Down $1.30.
  • Palladium, $569.40, Down $2.60.

APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (EDT)! Or call us Fridays until 6 p.m. (EDT)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help.

 

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