Gold News

Gold & Silver Slip as Obama's $825bn Stimulus Approved, Bad Bank & New Fed Policies Proposed

From Chris Mullen at

Gold Prices rose $2.57 an ounce to $901.42 in Asia on Wednesday before dropping to $882.80 by early trade in London.

Spot Gold then climbed back near $900 by midmorning in New York, but it
next fell back off in late morning trade and made a new low of $882.75.

Bouncing in afternoon trade, Gold Prices ended with a loss of 1.1%, while silver fell to end with the same loss for the day.

The Obama administration announced a Bad Bank plan aimed at absorbing
the toxic assets still weighing on financial balance-sheets, helping
bank stocks rise. The World Economic Forum (WEF) now meeting in the
Swiss resort-town of Davos also provided a platform for world leaders
to debate about what they should do about the financial crisis.

The Federal Reserve meantime kept its target rate in a range of 0% to
0.25% –adding that rates will remain low "for some time" – and said it
may be prepared to buy longer-term Treasury bonds.

Jeffrey Lacker dissented from the other 8 voting members, stressing his
preference for buying Treasuries now instead of other, non-government

The House then voted to approve Obama's $825bn stimulus plan with a large majority.

Crude oil meantime rose slightly despite more inventory builds amongst
US stock-piles. The US Dollar index rose and Treasuries fell while the
Dow, Nasdaq, and S&P rose.

The Gold Price in Euros fell to about €674, platinum closed at $950,
and copper rose slightly to $1.48. Gold Mining and silver equities
traded mostly slightly lower and ended with about 2% losses.

Thursday at 13:30 GMT brings US Durable Goods Orders for December,
expected at -2.0%, plus Initial Jobless Claims for last week expected
at 575,000. Then comes the New Home Sales report for December, expected
at 400,000 annualized.

Chris Mullen is chief content manager of the GoldSeek family of websites, a leading source of gold news, comment and mining-stock data for private and institutional investors.

See the full archive of Chris Mullen articles


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