Today’s AM fix was USD 1,321.75, EUR 978.71 and GBP 824.34 per ounce. Friday’s AM fix was USD 1,355.25, EUR 1,002.18 and GBP 845.39 per ounce
Gold dropped $39.30 or 2.92% Friday, closing at $1,325.30/oz. Silver slid $1.27 or 5.84%, closing at $21.74. At 3:32 EDT Friday, Platinum fell $31.30 or 2.1% to $1,427.50/oz, while palladium slipped $18.53 or 2.5% to $713.97 /oz. Gold was up 0.16% and silver was down 2.03% on the week.
Gold has been up and down in choppy trading in London today as investors digest the U.S. Fed's decision to wait on tapering until perhaps next month. Comments on Friday from James Bullard, the St. Louis Federal Reserve Bank President affected the markets. He said, “A reduction of the Fed's $85 billion monthly bond purchase program beginning in October was possible and that the Fed can be patient in deciding when to scale back its pace of asset purchases.”
In Germany’s elections, Chancellor Angela Merkel is on her way for a third term as German leader after her party, the Christian Democratic Union (CDU) scored its best federal election result since 1990. However, it appears likely she has lost her coalition partner, the Free Democratic Party (FDP) as they failed to secure the required 5% threshold necessary and will be without Bundestag representation for the first time in its 65-year history.
Gold is finding support by the increasing consensus that the current Federal Reserve Vice Chair, Janet Yellen, will take over for Bernanke. Gold got a boost Thursday after a senior White House official's remarked that Yellen is a leading candidate to replace Bernanke when he steps down.
Yellen, a strong supporter of Bernanke's policies, should keep U.S. interest rates low for an extended period of time and she is very dovish, contrary to recent revisionism.
The U.S. national debt continues to surge higher every day and is now at $16.95 trillion and will soon surpass the $17 trillion mark.
When Standard & Poor's reduced the U.S.’s credit rating from AAA to AA-plus, it was the first time the U.S. ever suffered a downgrade to its credit rating. The S&P took this action despite the plan Congress passed last week to raise the debt limit.
The downgrade, S&P said, "reflects our opinion that the fiscal consolidation plan that Congress and the administration recently agreed to falls short of what, in our view, would be necessary to stabilize the government's medium-term debt dynamics."