Gold fluctuates heavily amid mixed sentiment
Gold fluctuated heavily today since opening the Asian session, affected by the mixed sentiment and mixed comments in the market, where on one hand the Greek Prime Minister was able to win a vote of confidence on the property tax increase, but on the other hand, Trichet dismissed talks on cutting key rates by 50 basis points, negating expectations spread in the market for a possible cuts.
Gold opened the session today at $1650.53 per ounce, and reached a high of $1669.07 and a low of $1632.05, and is currently hovering around $1650.13 per ounce.
The Greek Prime Minister, George Papandreou was able to win a vote of confidence by 155 votes against 142 on property tax increase, where the Greek Parliament backed Papandreou's proposal, which aims to meet budget deficit targets to avert default, which eased jitters and renewed fears regarding the Greek default, especially after Papandreou promised that Greece will grow soon, adding downside pressures on gold.
The Greek Parliament vote results was announced late yesterday, after Evangelos Venizelos, the Greek finance minister called on Greek lawmakers to approve the measures to meet the budget deficit and avoid default, where Greece should meet the targets set by international lenders in order to obtain the next 8 billion euro tranche of 2010's bailout package.
On the other hand, the European Central Bank's chairman, Jean-Claude Trichet told the Italian newspaper, Corriere Della Sera, that the bank movements and actions is very critical to obtain financial stability and confidence, especially when the deepening debt crisis pressured the economy, however, the bank primary contribution is to create more jobs and support growth to expand.
Trichet also said that the bank has never planned to raise rates based on expectations or previously prepared programs. The chairman added that the bank could stop buying European bonds once the European Financial Stability Facility is able to buy them in secondary market.
As we noticed, Europe remains the main focus in the market as the debt crisis has affected the overall growth in the world, and affected the pace of recovery too, awaiting the critical vote from European parliaments on the expanded powers of the European Financial Stability Facility after Slovenian Parliament approved on the expansion of the Facility.
Among other precious metals, silver opened the session today at $31.90 per ounce and recorded the highest at $32.80 and the lowest at $30.70, while the metal trades now at $31.90 per ounce.
Moreover, platinum is still trading below the shiny metal at $1560.05 per ounce, while the metal set the highest at $1569.00 and the lowest at $1536.45, noting that the opening level was at $1561.50 per ounce.