IBT: Gold Price in U.S. Trading Breaks through $1,900 Level
Gold rose Monday in U.S. trading as traders mulled the renewed possibility that the nation was heading into a double-dip recession and an apparent inability of European to tackle the Greek sovereign debt crisis.
The U.S. Labor Department said Friday no new jobs were created last month, a shocking lapse for the world's strongest economy and one that renewed worries that the already moribund recovery from the Great Recession was actually turning into another recession.
In Europe, meanwhile, stocks plunged 3.3 percent and government bonds from the southern periphery of the continent dropped as investors worried about the sovereign debt crises of Greece, Spain, Portugal and Italy.
Adding to their concerns were worries that German Chancellor Angela Merkel, whose party lost key elections over the weekend, will not be able to rally enough domestic support to aid the euro zones's weakest members.
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More trouble may lie ahead: On Wednesday a German constitutional court will rule on claims that Merkel is breaking German law and European treaties by contributing to bailouts for Greece, Portugal and Ireland.
"Not a great start to the week. There is a lot going on for banks, especially in the light of a low-growth environment and the backdrop in the euro zone not improving," Mike Lenhoff, chief strategist at Brewin Dolphin, told Reuters.
Gold for December delivery, the most actively traded contract on the CME Comex division of the New York Mercantile Exchange, rose 1.4 percent to $1,903.44 per ounce in midday trading. Earlier in the session it had traded as high as $1,908.40.
