Conflicting factors continue to keep gold drifting in a short range just above $1700/ounce this morning: Apple and Amazon posting lower than expected earnings was somewhat countered by reports that the U.S. economy grew at a faster than expected 2% annualized rate.
Overseas, Brazil’s central bank has bought gold bullion for the first time in four years, as Turkey’s central bank takes advantage of the price drop to add a whopping 6.8 tons of gold to that nation’s reserves. Private interests in India have also started taking advantage of lower gold prices ahead of their festival and wedding season, which will peak in late November, but at a rate so far that lags last year’s purchases.
Looking ahead, seventeen companies in the S&P 500 announce earnings today, and investors seem in a holding pattern ahead of promised economic policy changes in the EU and Japan. The Fed’s pledge to keep interest rates near zero even when the recovery starts may fuel inflation concerns. Add to all the above a deadlocked Congress that cannot agree to spending cuts, which threatens to trigger the “fiscal cliff” of automatic cuts across all government spending, and the near future is muddy indeed.
At a half hour past the opening bell, spot gold is trading at $1716/oz and silver at $32.35.