Gold Price At 6 Year High In Euros At €1,288 As ECB Says Outlook Is “Worse And Worse”

Gold rose to a six and a half year high in euros at €1,288/oz yesterday prior to giving up the gains as it succumbed to profit taking in volatile trading during and after the ECB meeting.

Gold in Euros – 10 Years – GoldCore.com

Gold spiked to its highest level since 2013 in response to the more dovish ECB policy statement. It then quickly changed course following the release of upbeat US durable goods orders data for June which saw it give up gains in all currencies. Stock markets rose before giving up gains as did gold.

Today, gold prices have edged higher and recovered a part of yesterday’s intra-day sell off. Gold is currently set for a small weekly gains in most currencies including euros and pounds with stronger gains for the week seen in the embattled Australian dollar.

The euro hits two-year lows against the dollar and six year lows against gold after the ECB signaled ‘stimulus’ which will involve interest rate cuts and the likely return to digital euro creation in order to support Eurozone bond markets and economies.

Mario Draghi’s ECB announcement was in line with the consensus as he signaled interest rate cuts in the near future as the economic outlook is “getting worse and worse”.

Silver soared to a more than one-year high on increasing expectations that the ECB, the US Federal Reserve and other major central banks will have to adopt a ultra loose monetary policies again to prevent a global recession.

Uncertainty in the Middle East and tensions between the Iran and the UK and the U.S. should support gold and may lead to increased safe haven demand.

Britain has sent a warship to accompany all British-flagged vessels through the Strait of Hormuz, a change in policy announced by new PM Johnson’s government yesterday. The UK government had previously said that it did not have the resources to do so.

U.S. Secretary of State Mike Pompeo said in a television interview yesterday that he would go to Iran and talk to the Iranian people, amid rising tensions between Tehran and Washington.

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