Gold Breaks Above $1,620 An Ounce
August 20, 2012
By James O'Dell
Los Angeles, CA. – Morgan Gold - Gold and Silver prices rallied on Monday, boosting the Gold price to $1,620.50 an ounce, and the Silver price to $28.64 an ounce, as Gold follows the commodity complex higher, and the CRB index climbs 12 percent after bottoming in late June. Goldman says commodity prices will spike 30 percent over the coming 12 months and it will be led by energy and the base metals. If today is a preview, Gold looks ready to set new highs. "The 11 week moving average comes in at $1601," said Scotia Mocatta, after Gold finished above that level for four straight weeks.
Meanwhile, Political factors may in large part, drive the direction of Gold this week, says Commerzbank, citing several meetings scheduled between leaders of the euro zone, including Germany's Merkel, France's Hollande, Greece's Samaras, and Eurogroup President Jean-Claude Juncker. “According to newspaper reports, Greece will require even more financial aid by 2014 because the country is unable to meet its agreed austerity targets,” said Commerzbank.
“The Troika will be presenting its official report on the financial situation in Greece in mid-September. There are also reports that the ECB is planning to introduce an upper limit for the yield spreads of aid countries vis-a-vis German federal bonds in its new bond-acquisition program." It may just be a rumor, as Germany’s central bank, the Bundesbank, had earlier voiced strong opposition to bond purchases while a spokesman from the German finance ministry was unaware of any plans by the European Central Bank (ECB), to target bond spreads.
If the plan is adopted, the ECB will begin buying up government bonds from countries affected by the crisis if yields for those bonds get out of hand by a predetermined amount. This would tell investors the interest rate levels the ECB considers to be appropriate. I wouldn't think this plan would be acceptable to the German people or the government. Protect your wealth and your retirement, during these times of economic and geopolitical uncertainty, by investing in physical Gold and Silver bullion.
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