Best of the Week
Most Popular
1. TESLA! Cathy Wood ARK Funds Bubble BURSTS! - 12th May 21
2.Stock Market Entering Early Summer Correction Trend Forecast - 10th May 21
3.GOLD GDX, HUI Stocks - Will Paradise Turn into a Dystopia? - 11th May 21
4.Crypto Bubble Bursts! Nicehash Suspends Coinbase Withdrawals, Bitcoin, Ethereum Bear Market Begins - 16th May 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.Cathy Wood Ark Invest Funds Bubble BURSTS! ARKK, ARKG, Tesla Entering Severe Bear Market - 13th May 21
7.Stock Market - Should You Be In Cash Right Now? - 17th May 21
8.Gold to Benefit from Mounting US Debt Pile - 14th May 21
9.Coronavius Covid-19 in Italy in August 2019! - 13th May 21
10.How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part 2 of 2 - 18th May 21
Last 7 days
US Economy and Stock Market Addicted to Deficit Spending - 17th Oct 21
The Gold Price And Inflation - 17th Oct 21
Went Long the Crude Oil? Beware of the Headwinds Ahead… - 17th Oct 21
Watch These Next-gen Cloud Computing Stocks - 17th Oct 21
Overclockers UK Custom Built PC 1 YEAR Use Review Verdict - Does it Still Work? - 16th Oct 21
Altonville Mine Tours Maze at Alton Towers Scarefest 2021 - 16th Oct 21
How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
The Only way to Crush Inflation (not stocks) - 14th Oct 21
Why "Losses Are the Norm" in the Stock Market - 14th Oct 21
Sub Species Castle Maze at Alton Towers Scarefest 2021 - 14th Oct 21
Which Wallet is Best for Storing NFTs? - 14th Oct 21
Ailing UK Pound Has Global Effects - 14th Oct 21
How to Get 6 Years Life Out of Your Overclocked PC System, Optimum GPU, CPU and MB Performance - 13th Oct 21
The Demand Shock of 2022 - 12th Oct 21
4 Reasons Why NFTs Could Be The Future - 12th Oct 21
Crimex Silver: Murder Most Foul - 12th Oct 21
Bitcoin Rockets In Preparation For Liftoff To $100,000 - 12th Oct 21
INTEL Tech Stock to the MOON! INTC 2000 vs 2021 Market Bubble WARNING - 11th Oct 21
AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
Stock Market Wall of Worry Meets NFPs - 11th Oct 21
Stock Market Intermediate Correction Continues - 11th Oct 21
China / US Stock Markets Divergence - 10th Oct 21
Can US Save Taiwan From China? Taiwan Strait Naval Battle - PLA vs 7th Fleet War Game Simulation - 10th Oct 21
Gold Price Outlook: The Inflation Chasm Between Europe and the US - 10th Oct 21
US Real Estate ETFs React To Rising Housing Market Mortgage Interest Rates - 10th Oct 21
US China War over Taiwan Simulation 2021, Invasion Forecast - Who Will Win? - 9th Oct 21
When Will the Fed Taper? - 9th Oct 21
Dancing with Ghouls and Ghosts at Alton Towers Scarefest 2021 - 9th Oct 21
Stock Market FOMO Going into Crash Season - 8th Oct 21
Scan Computers - Custom Build PC 6 Months Later, Reliability, Issues, Quality of Tech Support Review - 8th Oct 21
Gold and Silver: Your Financial Main Battle Tanks - 8th Oct 21
How to handle the “Twin Crises” Evergrande and Debt Ceiling Threatening Stocks - 8th Oct 21
Why a Peak in US Home Prices May Be Approaching - 8th Oct 21
Alton Towers Scarefest is BACK! Post Pandemic Frights Begin, What it's Like to Enter Scarefest 2021 - 8th Oct 21
AJ Bell vs II Interactive Investor - Which Platform is Best for Buying US FAANG Stocks UK Investing - 7th Oct 21
Gold: Evergrande Investors' Savior - 7th Oct 21
Here's What Really Sets Interest Rates (Not Central Banks) - 7th Oct 21
CISCO 2020 Dot com Bubble Stock vs 2021 Bubble Tech Stocks Warning Analysis - 6th Oct 21
Precious Metals Complex Searching for a Bottom - 6th Oct 21
FB, AMZN, NFLX, GOOG, AAPL and FANG+ '5 Waves' Speaks Volumes - 6th Oct 21
Budgies Flying Ability 10 Weeks After wings Clipped, Flight Feathers Cut Grow Back - 6th Oct 21
Why Silver Price Could Crash by 20%! - 5th Oct 21
Will China's Crackdown Send Bitcoin's Price Tumbling? - 5th Oct 21
Natural Gas News: Europe Lacks Supply, So It Turns to Asia - 5th Oct 21
Stock Market Correction: One More Spark to Light the Fire? - 5th Oct 21
Fractal Design Meshify S2, Best PC Case Review, Build Quality, Airflow etc. - 5th Oct 21
Chasing Value with Five More Biotech Stocks for the Long-run - 4th Oct 21
Gold’s Century - While stocks dominated headlines, gold quietly performed - 4th Oct 21
NASDAQ Stock Market Head-n-Shoulders Warns Of Market Weakness – Critical Topping Pattern - 4th Oct 21
US Dollar on plan, attended by the Gold/Silver ratio - 4th Oct 21
Aptorum Group - APM - High RIsk Biotech Stocks Buy, Sell, Hold Investing Analysis for the Long-run - 3rd Oct 21
US Close to Hitting the Debt Ceiling: Gold Doesn’t Care - 3rd Oct 21
Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
Original Oculus VR HeadSet Rift Dev Kit v1 Before Facebook Bought Oculus - 3rd Oct 21
Microsoft Stock Valuation 2021 vs 2000 Bubble - Buy Sell or Hold Invest Analysis - 1st Oct 21
How to profit off the Acquisition spree in Fintech Stocks - 1st Oct 21
�� Halloween 2021 TESCO Shopping Before the Next Big Panic Buying! �� - 1st Oct 2
The Guide to Building a Design Portfolio Online - 1st Oct 21
BioDelivery Sciences International - BDSI - High RIsk Biotech Stocks Buy, Sell, Hold Investing Analysis for the Long-run - 30th Sep 21
America’s Revolving-Door Politics Behind the Fall of US-Sino Ties - 30th Sep 21
Dovish to Hawkish Fed: Sounds Bearish for Gold - 30th Sep 21
Stock Market Gauntlet to the Fed - 30th Sep 21
Should you include ESG investments in your portfolio? - 30th Sep 21
Takeda - TAK - High RIsk Biotech Stocks Buy, Sell, Hold Investing Analysis for the Long-run - 29th Sep 21
Stock Market Wishing Away Inflation - 29th Sep 21
Why Workers Are NOT Returning to Work as Lockdown's End - Wage Slaves Rebellion - 29th Sep 21
UK Fuel PANIC! Fighting at the Petrol Pumps! As Lemmings Create a New Crisis - 29th Sep 21
Gold Could See Tapering as Soon as November! - 29th Sep 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold retests $1800 as Italian Bond Yields hit "Dangerous Levels

Commodities / Gold and Silver 2011 Nov 08, 2011 - 08:14 AM GMT

By: Ben_Traynor

Commodities

Best Financial Markets Analysis ArticleTHE DOLLAR gold price climbed to $1796 an ounce Tuesday morning London time – 2.3% up on last Friday's close – as stocks rallied and government bonds sold off ahead of a key budget vote in Italy.

The previous day, gold hit its highest level in nearly seven weeks during Monday's US trading, when it rose to $1798 per ounce.


"[The gold price] continues to grind higher and targets the all-time high around $1921," says Commerzbank technical analyst Axel Rudolph.

The silver price hovered around $34.85 per ounce on Tuesday morning – 2% up on last week's close – while other industrial commodities were also broadly flat.

Yields on 10-Year Italian government bonds meantime hit 6.74%– their highest level since 1997.
Italian bond yields "are really reaching very dangerous levels," reckons Alessandro Giansanti, credit market strategist at ING in Amsterdam.

"If we move above 7% it will become a completely different challenge for Italy to find non-domestic buyers."

Italy's Chamber of Deputies will take a vote on last year's budget plan later on Tuesday, in what will be the first vote since three members of prime minister Silvio Berlusconi's party defected to the opposition – and the first since six others publicly called on him to resign. 

The vote is seen by many observers as a test of whether the government still has a majority, and thus whether it will be able to deliver reforms pledged by Berlusconi in a letter to European Union leaders last month.

"What we are expecting from Italy is that Italy will implement all the measures which have been announced in Silvio Berlusconi's letter," Jean-Claude Juncker, chairman of the Eurogroup of single currency finance ministers, said Monday.

"It's essential now that Italy stick to its fiscal targets," added Olli Rehn, European commissioner for economic and monetary affairs.

The European Commission is due to send representatives to Rome this week to monitor Italy's progress on reforms.

Greece meantime remained without a government Tuesday lunchtime, as political parties continued to negotiate who should be the new prime minister. European leaders have asked Greece to commit in writing to the terms of its bailout, in order to receive the next tranche of funding, worth around €8 billion.

Japan has said it bought 10% of the €3 billion-worth of bonds auctioned by the European Financial Stability facility yesterday. Back in January, Japan bought 20% of a €5 billion issue of 5-Year EFSF bonds.

"The decision to buy fewer of the EFSF bonds reflects the government's caution," reckons Junko Nishioka, chief Japan economist at RBS Securities in Tokyo.

"The Euro's been falling and there's a risk it may drop even more."

European finance ministers – who will hold a second day of meetings today – have pledged to implement a scaled-up rescue fund by next month.

"It's all very well saying we've got a firewall," said Britain's chancellor George Osborne
"But the Eurozone now need to convincingly show the world that the firewall exists and it's got sufficient resources in it."

"This isn't a crisis you can solve quickly," warned Dutch finance minister Jan Kees de Jager on Monday.

 "It is a monster with many heads."

France meantime announced its second austerity package in less than three months yesterday. The measures are aimed at saving €7 billion next year, in an effort to meet a deficit target of 4.5% of GDP. 

The new measures "should not alleviate any of the concerns some market participants have over the country's triple-A rating," warns a note from economists at Credit Suisse.

Ratings agency Moody's last month warned that it was considering changing France's credit outlook from 'stable' to 'negative'. Were France to lose its AAA-status, it could compromise its position to aid other Eurozone members.

"While gold might be enjoying some safe-haven buying, we warn that should the Eurozone debt crisis result in a drying-up of the region's money markets, all commodities will suffer, including gold," says a note from Standard Bank commodities strategist Marc Ground.

China's gold imports hit a record high in September – a six fold increase year-on-year – according to data from the Hong Kong government.

"In September we saw some bargain hunters come back into the market," Janet Kong, managing director of research at Chinese investment bank CICC told the Financial Times, citing that months dip in the gold price.

"The [Shanghai Gold Exchange] physical premium is below zero this morning," said a note from the Mitsui Precious Metals Hong Kong desk on Tuesday, adding that this indicates "that physical demand is almost non-existent at current price levels."

By Ben Traynor
BullionVault.com

Gold price chart, no delay   |   Buy gold online at live prices

Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK's longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics.

(c) BullionVault 2011

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in