Futures Market News
Greek, economic troubles push gold futures higher
Jun 10, 2011 03:58 PM
The sovereign debt crisis tearing through Europe and worries about the slowing economic recovery from the global recession are likely to push gold futures to their fourth straight weekly gain, Bloomberg reports.
Debt-hobbled banks in Europe have especially benefited the yellowish metal's performance, as Greece is reportedly on the precipice of defaulting should higher borrowing costs add to the Aegean nation's troubles. The European Central Bank indicated it will raise interest rates for lending, which is likely to push Greece toward default since borrowing additional money to exit its indebtedness is mandated. The nation accepted a bailout in June 2010 and is encountering trouble adhering to a repayment schedule.
"It looks like there’s really no way out. That’s still bullish for gold," Bruce Ikemizu, head of commodity trading at Standard Bank, told the news service.
At 6:55 a.m. on Friday, gold futures slipped 0.04 percent, a 60 cent drop to $1,542.10 per troy ounce.
MarketWatch reports the U.S dollar strengthened, which pushed down gold futures as they two typically perform the inverse of one-another. The dollar index, which measures the greenback’s performance against six counterpart currencies, rose in value.
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