Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Gold Price Slowly Going Nowhere - 20th Oct 21
Shocking Numbers Show Government Crowding Out Real Economy - 20th Oct 21
Crude Oil Is in the Fast Lane, But Where Is It Going? - 20th Oct 21
3 Tech Stocks That Could Change The World - 20th Oct 21
Best AI Tech Stocks ETF and Investment Trusts - 19th Oct 21
Gold Mining Stocks: Will Investors Dump the Laggards? - 19th Oct 21
The Most Exciting Medical Breakthrough Of The Decade? - 19th Oct 21
Prices Rising as New Dangers Point to Hard Assets - 19th Oct 21
It’s not just Copper; GYX indicated cyclical the whole time - 19th Oct 21
Chinese Tech Stocks CCP Paranoia, VIES - Variable Interest Entities - 19th Oct 21
Inflation Peaked Again, Right? - 19th Oct 21
Gold Stocks Bouncing Hard - 19th Oct 21
Stock Market New Intermediate Bottom Forming? - 19th Oct 21
Beware, Gold Bulls — That’s the Beginning of the End - 18th Oct 21
Gold Price Flag Suggests A Big Rally May Start Soon - 18th Oct 21
Inflation Or Deflation – End Result Is Still Depression - 18th Oct 21
A.I. Breakthrough Could Disrupt the $11 Trillion Medical Sector - 18th Oct 21
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

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Indian Banks Banned from Lending for Gold Purchases

Commodities / Gold and Silver 2012 Nov 20, 2012 - 07:56 AM GMT

By: Ben_Traynor

Commodities

SPOT MARKET prices for buying gold traded above $1730 an ounce throughout Tuesday morning in London, up 1% for the week so far, while the Euro also held onto gains made yesterday despite news that a second ratings agency this year has downgraded France.

Gold rose by more than $20 during Monday's trading, following reports that a deal may be done between US politicians on the so-called fiscal cliff.


"People are feeling a bit at ease about the budget talks in Congress," says Yuichi Ikemizu at Standard Bank in Tokyo.

"But gold is in a tight range between $1,700 and $1,740 until we see a result of the talks at the year end, as the 'fiscal cliff' is the focus of the market."

Silver meantime traded around $33.20 an ounce this morning, up more than 3% from last week's close.

Most European stock markets ticked lower this morning, with the exception of Germany's DAX, while commodities were broadly flat.

Moody's last night became the second rating agency this year to downgrade France. Moody's lowered its credit rating for France by one notch, from Aaa to Aa1, while maintaining a negative outlook.

"Moody's is now giving France the same rating as Standard & Poor's," French finance minister Pierre Moscovici said Monday following the downgrade announcement.

"[This rating] has allowed us to live with low interest rates for many months."

Although S&P stripped France of its AAA rating back in January, benchmark yields of 10-Year French governments bonds have fallen, from above 3% to close to 2%.

In its ratings rationale, Moody's cites "sustained loss of competitiveness" and "deteriorating economic prospects" as reasons behind the decision.

In addition, Moody's argues that France's membership of the Euro and therefore its lack of monetary sovereignty could make it more difficult to deal with a rise in borrowing costs.

"While the French government's debt service costs have been largely contained to date, Moody's would not expect this to remain the case in the event of a further shock," a statement from the ratings agency said.

"A rise in debt service costs would further increase the pressure on the finances of the French government, which, unlike other non-Euro area sovereigns that carry similarly high ratings, does not have access to a national central bank that could assist with the financing of its debt in the event of a market disruption."

Eurozone finance ministers meantime meet in Brussels today, where they will discuss whether to approve payment of the next installment of bailout money for Greece. If they agree, national parliaments will then vote on the matter.

The Eurogroup is also expected to discuss policies aimed at improving Greece's debt sustainability. Policies reportedly under discussion include cutting interest rates in loans to Greece and extending the time for repaying loans.

Germany has suggested a debt buyback of privately held debt at haircuts of 75%, CNBC reports, while Finland's finance minister has confirmed politicians are also looking at using profits from the European Central Bank's Securities Markets Programme, which formally ended in September.

Under the SMP, the ECB bought the debt of distressed sovereigns in the open market. Because it bought bonds that were trading below their par value, the central bank is due to make a profit on this debt if it is held to maturity.

Athens meantime rejected a demand yesterday by the International Monetary Fund to cut an additional 22,000 civil service jobs.

Spain meantime sold more debt than anticipated at an auction of 12- and 18-month Treasury bills this morning, raising €4.9 billion. The yield on the 12-month bills was down slightly compared to the last auction of such debt, although 18-month yields rose.

Spain has over €100 billion of debt due to mature in 2013.

In the UK, chancellor George Osborne is considering reducing tax relief on the pension contributions of wealthier people, ahead of next month's Autumn Statement on the economy, the Financial Times reports.

India's central bank meantime has banned banks from lending money for the purposes of buying gold.

"It is advised that no advances should be granted by banks for purchase of gold in any form, including primary gold, gold bullion, gold jewellery, gold coins, units of gold Exchange Traded Funds (ETF) and units of gold mutual funds" said a statement issued by the Reserve Bank of India Monday.

India is tradtionally the world's biggest gold buying nation.

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 2012

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