Gold Consolidates Near $1,200 as Economic Concerns Grow

August 11, 2010

Gold

Gold rose yesterday in the intermediate aftermath of the worse than expected US trade deficit figures ($49.9 billion – exports down 1.3%; imports down 3%). Gold has maintained those gains despite weakness in equity markets and in US futures.

Risk aversion is back on after the Federal Reserve expressed concerns about the recovery. The pessimistic tone of their communication has led to increased concerns of a double dip recession. In this environment, investors should remain defensive and continue to diversify into gold.

Gold appears to be consolidating at $1,200/oz after the recent weakness seen in the traditional ‘summer doldrum’ period.

Gold is currently trading at $1,205.40/oz, €929.93/oz and £768.64/oz.

Silver

Silver is currently trading at $18.08/oz, €13.95/oz and £11.53/oz.

Platinum Group Metals

Platinum is trading at $1,533.50/oz, palladium is at $471/oz and rhodium is at $2,100/oz.

Mark OByrne

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