By Barry Stuppler – MintStateGold.com
Gold is up today on market confidence that the latest European Union summit is coming up with a workable plan by Wednesday. Gold is trading at $1,651.60, up $16.10 per ounce on very active volume. Additionally, there were reports overnight that India’s demand for physical gold is on a record pace, and in turn, helped the increase in gold’s price.
Bank of American warns of downgrade to U.S. credit
Last Friday, Bank of America Merrill Lynch economists, warned that America’s credit rating is likely to take another hit before the end of 2011, threatening renewed market turmoil. In that report, BofA Merrill said it sees little hope of a breakthrough by the congressional “super committee” on deficit reduction. The bipartisan group has until Nov. 23 to identify $1.5 trillion in deficit cuts over the next 10 years — through reduced spending, tax hikes or both.If the U.S. credit rating is downgrade I believe it will accelerate the pace of countries that are moving their central bank reserves from U.S. Dollars into Gold.
Silver is trading at $31.75 per ounce at 11am PDT, up $0.55 on active trading. If the Eurozone nations have come to an agreement to avert a global recession, this would be very positive news for Silver. Also, physical demand in Asia for Silver is causing shortage in many markets.
PLATINUM – PALLADIUM
It appears that both platinum and palladium are the biggest beneficiaries of today’s global rally. Both metals have increase over $26 per ounce. Platinum is still trading at about a $100 discount to gold, and looks attractive.