World bond and stock markets rose on today after a week of falls. Sterling surged to a two-month high against the dollar after the business-friendly Conservative party won Britain’s parliamentary election.
Sterling jumped 1.3% against the dollar but was flat against gold after gold recovered from initial losses.
London’s FTSE led equity markets with a 1.9% move higher to help European shares rebound from two-month lows and wipe out what had looked like being a second week of losses.
Chart shows gold in euro, 1-week
German imports climbed more sharply than exports in March and industrial output dipped, suggesting that Europe’s largest economy might have grown less than economists expected in the first quarter. The figures contrasted with with news yesterday that demand for goods made in Germany had climbed by nearly 1% in March.
The Greek debt saga is supporting gold in euro terms and gold is higher in euro terms this week.
Greek Prime Minister Alexis Tsipras again forecast a happy end soon to difficult negotiations with creditors on a cash-for-reform deal, and the chairman of euro zone finance ministers said talks were making progress, though not enough for a deal next Monday.
However, with Greece fast running out money, sources close to the talks with the IMF, the European Commission and the ECB said there was still no breakthrough on important sticking points over pension and labour market reforms and budget targets.