Gold for December delivery rose to a high of $1,134 an ounce on Globex, up $13.60, or 1.2%.
Standard & Poor's cut Spain's credit outlook on Wednesday to negative from stable. S&P had put Greece on negative watch on Monday. See story on Spain's outlook cut.
"What is happening in Europe is exactly what we have been predicting for some time -- a sovereign debt crisis across most Western countries that is just starting," said Martin Hennecke, associate director at Tyche Group Ltd.
"Gold will increasingly take the role of a shelter from ... hyperinflation that will be the most likely outcome of these crises," he said, adding that the "metal is not just a dollar hedge, but going forward, will more likely take a much more significant role of being a hedge against the uncertainties and rising inflation risks of all of the world's major currencies."
Also Wednesday, Moody's Investors Service placed the ratings of government-related issuers in the United Arab Emirates on review for possible downgrade. See story on Moody's decision.
But Ned Schmidt, editor of the Value View Gold Report, argued that the climb in gold's price, at least for now, is "nothing more than a trading bounce from hitting $1,115."
The price of gold "will not be done going down till it looks like it will never go up," he said.
December gold had fallen by $22.40, or 2%, to close at a nearly one-month low of $1,120.40 on the Comex division of the New York Mercantile Exchange on Wednesday.
Since hitting a new high above $1,226 an ounce on Dec. 3, gold had tumbled nearly $100, or 8%, in the four sessions, its longest losing streak in six weeks as the U.S. dollar edged higher against its foreign rivals, taking away some investor interest from the precious metals
Standard & Poor's cut Spain's credit outlook on Wednesday to negative from stable. S&P had put Greece on negative watch on Monday. See story on Spain's outlook cut.
"What is happening in Europe is exactly what we have been predicting for some time -- a sovereign debt crisis across most Western countries that is just starting," said Martin Hennecke, associate director at Tyche Group Ltd.
"Gold will increasingly take the role of a shelter from ... hyperinflation that will be the most likely outcome of these crises," he said, adding that the "metal is not just a dollar hedge, but going forward, will more likely take a much more significant role of being a hedge against the uncertainties and rising inflation risks of all of the world's major currencies."
Also Wednesday, Moody's Investors Service placed the ratings of government-related issuers in the United Arab Emirates on review for possible downgrade. See story on Moody's decision.
But Ned Schmidt, editor of the Value View Gold Report, argued that the climb in gold's price, at least for now, is "nothing more than a trading bounce from hitting $1,115."
The price of gold "will not be done going down till it looks like it will never go up," he said.
December gold had fallen by $22.40, or 2%, to close at a nearly one-month low of $1,120.40 on the Comex division of the New York Mercantile Exchange on Wednesday.
Since hitting a new high above $1,226 an ounce on Dec. 3, gold had tumbled nearly $100, or 8%, in the four sessions, its longest losing streak in six weeks as the U.S. dollar edged higher against its foreign rivals, taking away some investor interest from the precious metals
No comments:
Post a Comment