Posted on 11/10/2009 12:52:39 PM PST by blam
Gold Slips To $1100 As UK Faces Potential Credit Ratings Downgrade
Commodities / Gold & Silver 2009
Nov 10, 2009 - 07:43 AM
By: Adrian_Ash
THE PRICE OF WHOLESALE gold slipped 1% from Monday's new record high early in London today, briefly drifting through $1100 an ounce as Asian stock markets closed the day higher but European shares held flat.
Crude oil ticked back down to $80 per barrel, but remained higher by one-third from this time last year.
The US Dollar held steady after Monday's sharp losses. Ten-year Treasury bonds offered 3.45% in yield.
"A correction is reasonable after [gold's] run-up from around $1030 in a little over a week," a researcher at Tokyo commodity brokers Okato Shoji Co. told Reuters this morning.
"Gold will keep looking north...benefiting from the world of a zero-yielding Dollar".
"Some people buy higher-yielding currencies, such as Australian and New Zealand Dollars. Others prefer buying gold without taking currency risks."
Both Japan's Eco-Watchers survey and Germany's ZEW sentiment index today came in well below analyst forecasts for October.
Fitch Ratings identified the UK as "potentially most at risk" of a downgrade to its government bonds because it faces the greatest need to adjust its public finances.
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