Gold and Silver's Daily Review for 30th November 2010
The euro today is again visibly weakening at $1.2990 down nearly a cent and a half on yesterday. The tone of the market seems to have stood back from just the Irish and now looks at the overall financial distress of the Eurozone.
Spain and Portugal and any other Eurozone crisis should have been dealt with in total because the Eurozone is one bloc financially, not a series of separate countries, from a finance point of view. Unless the problem is handled on a Eurozone wide basis the euro will continue to decline. Let's face it, the stresses will not go away until either the Eurozone accepts there will be no financially separate sovereignty for the different countries or until the poorer nations of the Eurozone leave it. Gold Fixed at $1,375 this morning in London, a $18 level better than the Fix than yesterday afternoon's Fix.
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Gold – Very Short-term
Gold performed better than expected yesterday and so far today, so we expect this positive performance to continue today. It is stronger than silver at the moment up $16 on yesterday so far.
Silver – Very Short-term
Silver performed better than expected yesterday and so far today, so we expect this positive performance to continue today. Currently at $27.2 this is a jump of nearly 50 cents on yesterday.
Gold Price Drivers
Today the euro is falling while the dollar is steady against the world's other leading currencies. We note that gold is now rising in all currencies again as it is being seen more and more a separate item from currencies, although its role as money is growing by the day. There is a huge psychological barrier to gold taking a judgmental role in the monetary system, but the pressure on it to do so is positively osmotic. Whether nations accept this as a whole or singly will not affect this process. It is a case of how long can the currency systems survive without some form of value measuring anchor?
When other nations doubt other's currencies on a broad front the need is there. But the willingness to put such an instrument in place is not. Meanwhile we wait for an announcement due soon to say that the I.M.F. has completed their gold sales!
Julian D.W. Phillips