Gold Bullion Breaches $1625, US Downgrade Now "Almost Certain" - 27 July 2011
http://goldnews.bullionvault.com/gold_bullion_072720113
Gold Bullion prices set a new intraday record of $1625 per ounce in Wednesday's Asian trade – 1.5% up on Friday's close – before easing back slightly after London opened.
Stocks and commodities fell but US Treasury bonds were up, as the US Congress had to postpone a vote on the $14.3 trillion debt ceiling.
Insuring US debt against default in the next 12 months now costs investors more than for 5-year bonds on the credit default swap market.
The Chicago Mercantile Exchange has meantime introduced a 0.5% 'haircut' on US Treasury bills used as collateral. T-bills were previously considered risk-free.
Silver Bullion prices also rose early Wednesday, hitting $41.22 per ounce – a 2.8% gain on last Friday – and remaining just below that level throughout the morning.
"Support [for gold] now appears strong at $1577, the April high," say technical analysts at Gold Bullion bank Scotia Mocatta.
"Overall, it is believed that market environment should remain favorable and positive technical momentum is likely to see gold test new highs in the near term," adds Swiss precious metals refiner MKS.
A vote on Republican House of Representatives speaker John Boehner's plan to cut the US deficit had to be postponed Wednesday – after the Congressional Budget Office found that his proposals would not actually produce the anticipated reductions in federal borrowing.
http://goldnews.bullionvault.com/gold_bullion_072720113
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