Los Angeles, CA – The price of Gold and Silver jumped to a two week high on Monday on expectations that the Euro Zone will take decisive steps this week to resolve the region’s two-year old sovereign debt crisis.
Gold jumped almost $30 to $1715 an ounce and Silver gained nearly 4% to $32 an ounce on news that the International Monetary Fund (IMF) was preparing to issue a 600 billion euro rescue package to Italy. As European finance chiefs are scheduled to meet this week, top economists from UBS AG, Morgan Stanley and Nomura International Plc say European governments and the European Central Bank (ECB) must take more proactive measures in response to the crisis. “Skepticism has grown that euro-area policy makers can deal effectively with the key challenges they face” said Pier Carlo Padoan, chief economists for Paris-based Organization for Economic Cooperation and Development (OECD). Padoan cut forecasts for European growth, citing serious downside risks links to “loss of confidence in sovereign-debt markets and the monetary union itself”.
Meanwhile, gold traders accumulated the largest stockpile of the precious metal to date, as holdings in exchange-traded products back by gold reached a milestone 2350.8 metric tons on November 23rd. A Bloomberg survey said that 18 of 26 market experts believe bullion will rise in value this week. In addition, hedge funds increased their bets on higher prices according to the Commodity Futures Trading Commission data. “There’s absolutely no doubt that people are still worried” said Carole Ferguson, analyst for Fairfax IS in London. “The market’s being constantly confronted with the flow of bad news. Gold’s still an asset that people will look at.”
Gold has risen in value for 11 consecutive years and is a rock-solid hedge against inflation and a weakening U.S. dollar. Investing in Gold and Silver is easier than ever; to learn how you can roll over your IRA or former 401(k) into a tax-free Gold IRA, please contact American Bullion Inc. at 1-800-326-9598 or email us here.