South Africa police standoff with illegal gold miners escalates
The police sealed off access to the Buffelsfontein gold mine in Stilfontein several weeks ago to deny the miners access to food and other essentials.
Gold futures added to record levels set earlier on Tuesday as Europe finance ministers consider allowing Greece to default on some of its debt, Italy’s borrowing costs soar and US Federal Reserve minutes indicate the possibility of additional financial stimulus.
Gold is considered a hedge against inflation and further quantitative easing could flood financial markets with cheap money as it did in the previous round – QE2 – when US monetary authorities injected some $600bn to drive down interest rates. Gold for August delivery on the New York Mercantile Exchange was trading at $1,568.40 an ounce in late trade after settling at a record $1,562.30 an ounce earlier.
Minutes from the US Federal Reserve meeting in June stated:
“Some participants noted that, if economic growth remained too slow to make satisfactory progress toward reducing the unemployment rate, and if inflation returned to relatively low levels after the effects of recent transitory shocks dissipated, it would be appropriate to provide additional monetary policy accommodation.”
The US added just 18,000 jobs in June, the lowest figure of 2011, and the unemployment rate ticked up to 9.2%. More than 14 million Americans are looking for work.
Image of Ben Bernanke, Chairman of the Federal Reserve speaking at the National Press Club, February 3, 2011 in Washington, DC is by Albert H. Teich / Shutterstock.com.
