The U.S. dollar is down across the board after the Thanksgiving break, as economic news from Germany, Canada and the U.K. firm the euro and the CAD. The weaker dollar gives headroom for gold and silver, headroom that they’ve taken – gold is comfortably above the $1,730/oz mark, and silver is eyeing $33.50 as its next goal. The short trading day today in the U.S. should lead to light volume.
Oil prices are settling down as the Gaza situation doesn’t seem to be escalating. In India, gold demand hit 9-week high as the wedding season gets into full swing, but the new law forbidding banks to issue loans for gold or silver purchases (including jewelry) and the rupee falling to a ten-week low should dampen domestic speculation and “exuberance” there.
Looking ahead, the EU is not only still wrangling with the IMF over the Greek loan terms (the EU wants to push the deadline back two years,) but now there is impasse between member states over the organization’s own budget. Germany, the U.K. and others want to see administrative budget cuts and the retirement benefits of EU government employees cut to be closer to those of the member governments, which have cut employee benefits during the financial crisis.
Another sticking point is farm subsidies- France and Poland are fighting a reduction in farm subsidies, which other nations say is necessary in order to trim the EU budget to under a €1 trillion.