Gold price tumbles on reports of de-escalating Middle East tensions
Gold plunged 3% after Axios reported that Israel and Lebanon have accepted the terms of a ceasefire agreement.
Once again this week the European Union’s debt crisis paved the path for the precious metals. This week Standard & Poor’s downgraded Greece’s Credit rating to “junk bond ” status as well as lowering Spain and Portugal’s credit ratings. This continues to drive investors into the precious metals especially Gold as a safer haven. Gold has become the currency of choice during this time of crisis in the European Union.
The Greek government will be meeting with the IMF, the European central Bank, and the European Commission in efforts to get Greece’s bail-out package approved. But Greece will need to show they are willing to take more stringent measures to get their debt reduced.
Germany has been reluctant to come to the aid of Greece stating “Greece must commit to further savings measures and show it can return to a sustainable economic path before Germany can approve emergency aid” said German Chancellor Angela Markel…
German Finance Minister Wolfgang Schaeuble attempted to put a positive spin on Greece’s fiscal needs by stating “The goal of the German government is … if the meetings in Athens with the Greek government, the IMF, the European Central Bank, and the European Union Commission succeed… to come to a decision as quickly as possible” he also stated “The stability of the EURO is the question, the last resort question. We’re seeking backing in the parliamentary groups for a speedy process, by Friday. And then we’ll pass a corresponding law next Monday”….
The FOMC met for a two day session this week and As expected left interest rates unchanged.
Jobless Claims fell 11.000 down to 448.000…
The demand from the jewelers of India has been sluggish of late due to higher prices however; the European’s have been big buyers of gold as a move to tangible hard assets.
The latest…..Moody’s downgraded 9 Greek Banks….. Spain’s unemployment is above 20%….
Silver has benefited from Gold’s demand as of this post is trading $18.70 per ounce….
Mike Daly / Gold Specialist
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