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Silver Market Morning

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Gold Today – Gold closed in New York at $1,623.40. London opened slightly lower at $1,620 and fell back to Fix at $1,616.50 as the euro fell back to €1: $1.2273. In the euro it was Fixed at €1,317.871 up €8 on Friday’s p.m. Fixing, while the euro stood at €1: $1.2266. Ahead of New York’s opening gold stood at $1,618.60 in the middle and in the euro at €1,320.72.

Silver Today – Silver in New York closed at $27.77 and pulled back slightly to in London to $27.70 ahead of New York’s opening.

Gold (very short-term)

Gold should have a mixed bias, today in New York.

Silver (very short-term)

Silver should have a mixed bias, today in New York.

Price Drivers

Gold & Silver –

We are preparing an article in two parts on, “What happens to Greece’s gold when Greece exits the Eurozone?” and “What happens to the gold world [central banks as well as other gold investors] when Greece exits the Eurozone. [To follow our weekly commentary, please subscribe to our newsletters at www.GoldForecaster.com and www.SilverForecaster.com]

We are of the opinion that this is almost a foregone conclusion now. The current discussions on a Eurozone bank regulator and a European banking union, highlights one feature and that is unpalatable to Germany as well as other financially strong Eurozone members. The problem is that if banks fail in one country, taxpayers in another country may pay its bills. The concept of a ‘nation’ is still far greater than the concept of the “Eurozone” and until that changes, there is little hope for monetary union there. Ultimately, this is the structural fault that will see the Eurozone stumble and perhaps fall.

This feature is also contributing to the need to give gold a more active supportive role in the Eurozone and global monetary system. Should banking, per se, embrace this need, then, the demand for gold for banks will be substantial!

As we enter August, we enter the last month of quiet markets for gold. The ‘gold season’ begins in around three weeks all over the world for different reasons. The current strength of gold is not the reason why gold is rising though. In this quiet time for gold, central bank demand is still there, when volumes rise. Chinese demand remains robust too. The net result is that gold in its quiet time isn’t falling. When demand returns in full volume we should see a different picture altogether.

Silver – Silver should keep moving with gold today, which in turn is following the euro again.

Regards,

Julian D.W. Phillips for the Gold & Silver Forecasters

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