Gold has suffered overnight with the return of the risk off sentiment. European stocks have all reversed following the overnight direction of Asian stocks and other riskier assets which had traded sharply lower after the World Bank cut its growth forecast for China and THAT combined with the widely reported comments from the former Greek PM Papademos that there are in fact no preparations in for Greece’s possible exit from the Euro, contrary to headlines that had been circulating, all added to heightened mood of risk aversion with the U.S dollar again the main beneficiary.
Also fuelling investor demand for safe haven assets we saw Fitch the rating agency downgrade Japan by 2 notches to A+ and with the Bank Of Japan leaving both their interest rates and their asset purchase fund unchanged questions are being asked about the commitment of the BoJ to not only boost their own economy and cut the massive trade balance but also how they intend to help tackle the European debt crisis although the bank did say that caution was needed due to the uncertainty in global financial markets but the US economy’s moderate recovery and signs of a better outlook for the domestic economy are actually positives.
Weak retail sales numbers from the U.K have and dovish comments after the release of the Monetary Policy Committee minutes have kept Sterling under pressure and with the dollar index, which tracks the US currency against a basket of other currencies, again challenging the 82 level we see both Cable and EURUSD lower in early trading. The risk aversion sentiment has helped drag the Euro currency down to the lowest levels of 2012 at 1.2614 the weak and that in turn has weighed heavily on precious metals.
Gold News
Gold opened at $1567.28 and made a high of $1567.63 but has run in to risk aversion selling and currently finds itself 1% lower and trading at $1555.20 just up from its $1551.55 low.
Silver News
Silver opened at $28.10 and hardly made any progress before the selloff started. The metal is lower by almost 2% at $27.70 with $27.55 the low.
Palladium News
Palladium is again below the key $600 level trading down to $595 lows where we still find the metal. The high has been $611 versus the $605 open.
Platinum News
Platinum is 1.2% lower on the day by 1.2% at $1425. We have seen the metal at $1417.70 versus the $1444 high.
