Daily Precious Metals Market Update 6/03/11
by Barry Stuppler – MintStateGold.com
Gold rallied today on a weaker Dollar and poor economic news, closing at $1,542.80, up $10.70 per ounce.
Why would the value of gold increase because of poor economic news? Because it increases the likelihood of continued low interest rates and additional government or Federal Reserve stimulus programs. The dollar extended its losses against the euro Friday after more details about a new aid package for Greece came to light, increasing confidence in European policy makers’ ability to handle the sovereign-debt crisis. I will be covering the likelihood of QE3 in Monday’s Weekly Market report, which is emailed to clients and friends. If you are not receiving this weekly report and would like to, please contact us.
Steve Forbes is again calling for a true U.S. Gold Standard, which would require $5,000 an ounce gold and U.S. Government removing $8 trillion in paper currency from circulation, versus $40,000 an ounce gold price.
For the complete story visit http://www.mintstategold.com/investor-education/forbes_gold_standard/
Silver, surprisingly strong considering today’s weak economic news, was up $.06 cents at the highs of the day closing at $36.44. Silver preformed an intra-day reversal today, trading down to $34.92 then rallying up to close on the highs of $36.44. This is a very strong technical indicator in the face of weak U.S. economic data that could lead to a double dip recession.
Today’s Other Important News:
Job growth decelerated sharply in May, the Labor Department said Friday. Total nonfarm payrolls increased by 54,000, much lower than the 125,000 gain expected by Wall Street economists. This is the smallest increase in nonfarm payroll since September. The unemployment rate ticked higher to 9.1% in May, from 9.0% in the previous month. Economists forecast the unemployment rate to fall to 8.9%.
Moody’s Investors Service said Thursday it may place the U.S. government’s debt rating on review for a downgrade if there is no progress in increasing the debt ceiling in the coming weeks. “If the debt limit is raised and default avoided, the Aaa rating will be maintained,” Moody’s said in a statement. “However, the rating outlook will depend on the outcome of negotiations on deficit reduction.”
Tune in Saturday evening for my weekly radio show on Talk Radio 790 KABC in the Southern California area, or listen to www.kabc.com at 9pm PST to hear an extended program on Gold, Silver and precious metals. The show is live (not recorded), so you can call in with your comments or questions.