Gold declines this morning unwinding from two-days of gains
Today, gold declined slightly, but still holding its position above $1520.00, where the decline came after yesterday's gains and the dollar's strong appreciation, where it surged yesterday to record the highest in 10 months. Investors since yesterday indulged in a strong selloff across the board amid the rising pessimism and downbeat outlook for growth and worsening debt crisis in Europe.
Compared to other commodities, gold is currently stabilized and trading within narrow levels, where tension is controlling investors amid the panic seen yesterday in the markets, most of the commodities fell, where S&P GSCI index declined by 3.4% which is the biggest drop in a month.
The U.S. dollar is forcing pressures on gold to decline after the two days of gains as the move so far to the downside for the metal is correction and holding its grounds on its appeal as a safe haven, unless it surrenders into the day to the dollar's strength amid heavy risk aversion.
Gold is holding its ground due to concerns dominating the market, where the European debt crisis is the primary reason behind the stability of gold. Fears are rising toward the current situation in Greece as expectations indicated that it might default, where eyes on the final meeting of the European finance ministers to come up with a reasonable solution for the crisis in order to provide financial stability in the zone.
Conditions for Greece took a horrible turn yesterday amid violent riots and unrest forcing the Prime Minister George Papandreou to seek a new Cabinet and call for a confidence vote from Parliament today, which if did not pass will trigger even a stronger wave of unrest across financial markets on more realized fears of default.
Gold is still affected also by inflation where after China moved on reserved following the rally in inflation, India followed in its footsteps. The Indian Central Bank also today raised rates by 25 bp to 7.50% to contain raging inflation pressures.
Gold is currently trading around $1526.40 per ounce, and recorded the high of $1531.22 and the low of $1524.65 per ounce after the opening of $1530.67.
Silver declined a bit today, where fears are dominating the markets, and investors tended to stay away from speculating on the metal, it is currently trading around $35.45 per ounce and recorded the high of $35.79 and the low of $35.28 after the opening at $35.77.
Platinum is currently trading around $1779.00 per ounce, where it recorded the high of $1795.00 and the low of $1775.00 per ounce after the opening at $1788.00.