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Gold Softer as Euro Reboundsby Peter A. Grant
Mar 22, AM 
Gold has softened ahead of the weekend amid speculation that Cyprus and the troika will cobble together a 'plan-B' ahead Monday's deadline. The bounce in the euro from four-month lows has weighed modestly on the yellow metal.However, deal or no deal, Cyprus — like some of the other Southern European countries — doesn't have an easy road ahead. Given the extended "bank holiday," the likelihood of a protracted period of capital controls, and the mere notion that people's savings were considered "in-play," have undoubtedly worried depositors across the eurozone...and in fact, around the world. Even here in the States, practically everyone calling into our firm wants to talk about little-old Cyprus. The term "contagion" has resurfaced. And if I were a saver in Greece, or Italy, or Spain, I'd be seriously considering getting at least some of my deposits out of harms way. Once you've withdrawn your euros from the bank, what do you do with them? Stuff 'em in your mattress? Buy gold? I'd wager many will ultimately opt for the latter. Eurozone confidence readings for March come out next week. While they will likely not truly reflect the turmoil in Cyprus this week, generally weaker prints are expected, with some risk for negative surprises. That ,may result in heightened ECB easing expectations. BoJ governor Kuroda is living up to expectations as the über-dove of the G7 central banks; at least in words so far. This amid continued speculation that he will call an emergency policy meeting prior to the scheduled meeting in the first week of April; perhaps bringing forward the open-ended asset purchases currently slated to begin in 2014. NEWSLETTER SIGN-UP Opinions expressed in commentary on the USAGOLD.com website do not constitute an offer to buy or sell, or the solicitation of an offer to buy or sell any precious metals product, nor should they be viewed in any way as investment advice or advice to buy, sell or hold. USAGOLD, Inc. recommends the purchase of physical precious metals for asset preservation purposes, not speculation. Utilization of these opinions for speculative purposes is neither suggested nor advised. Commentary is strictly for educational purposes, and as such USAGOLD does not warrant or guarantee the accuracy, timeliness or completeness of the information found here. |
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