Gold extends the gains recorded this week, ahead of the German bond auction, Greek debt talk to resu
With the start of the session today, gold returned to continue the upside move that started this week, where the metal gained momentum ahead of the German bond auction today and also ahead of the Greek debt talks, which are set to continue today.
Investors are holding more gold for two reasons, as the metal is expected to rebound to the upside as the weakening U.S. dollar eased some of the downside pressures forced on the metals, commodities and currencies to trade higher today. In addition, investors are demanding gold as a hedge against uncertainty especially ahead of the German first bond-auction test after the several downgrades on Friday and also ahead of the Greek talks with bondholders on the percentage haircuts, which are to continue today.
Gold gained 0.35% or $5.75 per ounce to currently hover around $1657.77 an ounce after the opening level of $1652.02 per ounce. The metal reached a high of $1659.54 and a low of $1583.81 an ounce.
The Greek talks with bondholders remain highly uncertain, where the Greek Prime Minister, George Papademos said that in case negotiations failed again today, the private sector could be forced to take losses on the bonds they hold, according to an interview published in New York Times.
The Premier also clarified that creditors could face a new legislation that force haircuts on the private sector in case they would not voluntary write down $130 billion of the total $450 billion Greek-debt.
Some relief was seen in the market after the Greek Prime minister announced that Greece on both ways will get rid of some of the huge amount the debt the nation handles, which sent the U.S. dollar south and eased the pressures forced on metals to continue the weekly upside move.
The announcement made by the Greek Premier has also overshadowed the negativity seen after the World Bank cut global growth forecasts again, where the bank cut the global growth forecasts to 5.4% from 6.2% for developing countries and to 1.4% from 2.7% for high-income nations. The cuts came as the bank expects the recession to worsen in Europe and as four European nations could be unable to access the capital market, which could pressure growth more during this year, noting that this is the bank's worst scenario.
Among other precious metals, silver added so far 0.47% of %0.14 per ounce to trade in the moment around $30.22 per ounce. The metal set the highest at $30.27 and the lowest at $29.85 after the opening of $30.08 per ounce.
Platinum on the other hand lost as much as 0.23% or $3.50 per ounce to trade now around $1518.25 per ounce after starting the day at $1521.75 per ounce. The metal reached a high of $1529.00 and a low of $1503.00 per ounce so far.
Palladium however advanced as much as 0.04% or $0.25 per ounce to $652.50 per ounce after the opening of $652.25 per ounce. The metal reached a high of $654.75 and a low of $646.75 per ounce.