Bullion:
Bullions counter may extend last week gains as the ultra loose monetary policies from US and the statement by Fed that U.S. central bank is in no rush to scale back its support for the economy with the labor market still not recovered supported the bullions. He also repeated his plans to keep overnight interest rates unchanged which is near zero since December 2008, extraordinarily low for `an extended period.` The greenback has also stumbled to new lows as it can test 72 levels in near term which will also be supportive factor for bullions. Signs of continuing accommodative monetary policy from the Federal Reserve, yet apparent concerns about inflation among policy setters, continue to keep the buying momentum intact in bullions.
The combination of the statement and Bernanke`s press conference left investors thinking even if QE2 ends, which they said it would, it doesn`t necessarily mean an end to accommodative monetary policies. Gold can test 23,000 while silver 75,000-76,000 in near term on the domestic bourses. Gold silver ratio further declined below 32 in previous week suggesting that silver continue to outperform gold as the ratio may slip to below 30 in near term.
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