GOLD PRICE NEWS – The gold price oscillated near unchanged Tuesday morning, trading at $1,468 per ounce. Gold prices held firm despite broad-based weakness in global stock and commodity markets brought about by news that two new earthquakes in Japan registering over magnitude 6.0 rocked the nation. Precious metals are one of the few safe havens this morning in what it setting up to be a rough day on Wall Street. Silver gained $0.51 to $40.76 per ounce. In the aftermath of the earthquakes Japanese authorities raised the severity of the country’s nuclear crisis to the highest level since the disaster at Chernobyl 25 years ago. Copper dropped 1% to 4.41 per pound on the news and emerging market stocks declined 1.3%, as measured by the MSCI Emerging Markets Index. The Japanese yen soared versus the dollar as investors and traders bet that further repatriation of yen would be forthcoming. The gold price fell $11.52 to $1,463.28 on Monday as the price of gold sold off following last week’s record-setting run. Although the gold price reached a new all-time high of $1,478 per ounce Sunday evening, it quickly relinquished its gains and turned lower yesterday as investors pared positions in the yellow metal. For a change, weakness in the gold price was not fueled by better than expected economic data or hawkish commentary from any Federal Reserve members. Instead, the price of gold simply turned lower due to exhaustion, having posted four consecutive days of new all-time highs. Despite the sell-off, the gold price remains higher by 1.6% in April and 3.0% year-to-date. Silver followed a similar path to that of the gold price on Monday, as it reached a new 31-year high of $41.975 per ounce before turning lower. After climbing to its highest level since 1980, the price of silver fell to a low of $39.77 before rebounding modestly. In doing so, silver snapped a five-session win streak, and finally took a breather from its recent price surge. The price of silver has more than doubled since last September, and at $41.975 on Monday had surged 35.6% year-to-date. Gold and silver equities were set to open marginally lower Tuesday morning after yesterday’s 2.7% drop – as measured by the Philadelphia Gold & Silver Index (XAU). The weakness in the XAU returned the gold stocks index to negative territory for 2011 – by 1.8%. Notable decliners on Monday include XAU components Freeport-McMoRan Copper & Gold (FCX), Harmony Gold (HMY), and Royal Gold (RGLD). FCX, HMY, and RGLD finished lower by 3.1%, 3.1%, and 1.7%, respectively. With the gold price rallying to a new record, hedge fund magnate John Paulson reiterated his bullish outlook in an interview with French newspaper Les Echos. As catalysts for his positive view on the gold price, Paulson cited rising inflationary risks over the next three to five years, as well as headwinds for the euro currency stemming from the sovereign debt crisis. The legendary investor, who famously made a fortune in 2007 shorting subprime securities, also provided a downbeat view on the current state of the U.S. housing market. “In my eyes, the major risk for the American recovery is the stagnation of the residential real-estate market. It will be difficult to have a rebound in real-estate prices this year.” In response to continued challenges in the housing market and broader economy, Paulson predicted that the Federal Reserve will continue to provide significant levels of monetary stimulus. In turn, the Fed’s accommodative policies will provide more room for the gold price to advance. Paulson went on to note that his firm, Paulson & Co., currently has approximately 3% of its assets in gold. In 2010 the investment firm launched a gold fund, in which Paulson invested $250 million of his personal wealth. Paulson & Co. also created gold-denominated share classes for each of its funds.

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