Gold News & Info

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold slipped 0.4% and the dollar strengthened as investors fretted over the possible consequences of French and Greek elections. Over the weekend, both nations voted out incumbents who supported to the unpopular Germany-led programs of austerity for containing the spreading sovereign debt crisis. Traders dumped the euro and bought dollars today, worried that the tenuous coalition that has heretofore prevented eurozone default might begin to unravel. Precious metals and traditional commodities fell on the stronger dollar. Silver and platinum dropped 0.4% while palladium lost 0.7%.

At the close: June gold slipped $6.10 to $1,639.10; July silver lost 31 cents to $30.12; July platinum fell $5.90 to $1,530.10; and June palladium dropped $4.35 to $647.80 an ounce.

Concern about the eurozone was a big reason why gold prices rose to record highs last year. So far this year, the dollar and U.S. Treasury bonds have gathered the lion's share of safe-haven inflows because the U.S. economy seemed to be gaining strength. Recent data, especially on unemployment, are now creating doubts about the recovery. If U.S. economic momentum weakens further and Europe becomes more unstable, investors are likely to scramble for cover, and gold could be a big beneficiary.

After last week's poor U.S. jobs report and slumping Eurozone manufacturing, speculators and hedge funds raised bullish bets on gold by nearly 8% to a four-week high, according to Bloomberg.