GOLD,SILVER & PRECIOUS MARKET WRAP

The price of gold has become one of the dominant themes in global markets over the past couple of years as the financial crisis unravelled. The Gold wrap reports on the latest trends in the price of the precious metal as well as factors influencing the demand for the safe haven asset.

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Monday, February 06, 2012

Gold falls after euro zone jitters boost US dollar

Gold falls after euro zone jitters boost US dollar

Gold prices dropped today as jittery investors poured money into the safe haven US dollar, which is seen as an alternative asset to the yellow metal, after another round of talks between Greek policymakers failed to produce any results.

The EU aimed to finalise the next €130 billion bailout package for the debt ridden country today.

However, Greek Prime Minister Lucas Papademos and other leaders of the ruling coalition failed to agree on further budget cuts, which are demanded by its official lenders including the EU, the International Monetary Fund (IMF) and the European Central Bank (ECB).

If Greece fails to seucre more financial aid, it will likely go into a disastrous default as soon as next month as it faces a deadline of March 20 to repay a €14.4 billion bond.

Negotiations between the policymakers are set to resume tomorrow.

Disappointed with the lack of an agreement on budget cuts, investors in Europe and the US sold stocks and bought safe haven assets, including the US dollar, which the euro and gold were out of favour.

Gold traded at US$1,718/oz, down US$7.5 from Friday’s close. Silver dropped 24 cents to US$33.43/oz and platinum slipped US$11 to US$1,610/oz.

Today’s top risers in the sector were:

GoldStone Resources (LON:GRL), up 7 percent at 5.75 pence at midday

Greatland Gold (LON:GGP), up 7 percent at 1.25 pence

Kryso Resources (LON:KYS), up 5.5 percent at 33.8 pence

Chaarat Gold Holdings (LON:CGH), up 5 percent at 27.69 pence

Central Rand Gold (LON:CRND), up 5 percent at 1.08 pence

The top fallers were:

Minco (LON:MIO), down 7.5 percent at 3.12 pence

GGG Resources (LON:GGG), down 6 percent at 16.11 pence

Orosur Mining (LON:OMI), down 5.5 percent at 54.5 pence

Solomon Gold (LON:SOLG), down 5 percent at 9.99 pence

Stratex International (LON:STI), down 5 percent at 7.5 pence


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