Gold News & Info

Source: American Gold Exchange

Austin— After rising overnight in Asia, gold seesawed today in the U.S. before ending slightly lower as a weaker dollar was offset by lingering eurozone concerns. The Greek parliament ratified austerity measures yesterday, albeit amid violent protests, lifting the euro and taking some safe-haven inflows away from the dollar. But EU officials still have to finalize the deal. Uncertainty over whether agreement will come at the meeting on Wednesday put a crimp in risk appetite, taking away from gold. While gold is typically a safe-haven asset, it has been tracking the euro and stocks in recent weeks, and today it was caught in ambivalence over whether events in the eurozone warrant risk or safety. Silver rose 0.4% as both platinum and palladium lost ground.

At the closes: April gold dropped 40 cents to $1,724.90; March silver gained 11 cents to $33.72; April platinum fell $10.10 to $1,649.70; and March palladium lost $4.50 to $698.55 an ounce.

Lawmakers in Greece made progress toward averting default on Sunday by approving a laundry list of deep cuts required by the so-called troika�EU, ECB, and IMF officials�before qualifying for a 130 billion euro bailout package. However, a group of European ministers is voicing doubts over whether the deeply unpopular austerity measures will actually be enforced or be enough. Led by Germany, the skeptics are making more demands on Greece before final approval. According to the Financial Times, they want proof of the 325 million euros in cuts, clarification on how 15% cuts in labor costs will be achieved, and reassurance that Antonis Samaras, Greece�s likely next prime minister, will back the deal. They also want certainty that central bank loans to Greece will not be subject to the same "haircuts" that private lenders must accept. If the skeptics are satisfied and the bailout passes, we'd expect a risk-rally lifting gold higher.

Gold demand in Asia, however, remains quite strong. "The Chinese guys are still buying," a physical dealer in Hong Kong told Reuters. "Whenever there is a dip in prices, they will buy. There's no change in their attitude." Demand is also strong in India, Malaysia, Thailand, and Vietnam. Analysts remain bullish on gold in the longer term because central bank easing is expected to increase risk of inflation.