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Gold Continues to Struggle Above $1400by Peter A. Grant
May 28, AM 
Gold has snapped back from earlier pressure, and while still lower on the day, is presently trading $20 off its intraday low. Interestingly, gold rose along with the dollar and shares. While the yellow metal peeked above $1400 briefly, these levels could not be sustained.Today's reported rise of 1.4% in the Case-Shiller home price index for March, along with a better than expected jump in May consumer confidence are boosting stocks. The intraday rebound in gold came in the wake of the consumer confidence print, suggesting that inflation risks may once again entering the consciousness of investors. More dovish central bank speak from both the ECB and the BoJ are contributing to heightened risk appetite. ECB executive board member Asmussen said an "open discussion" on negative deposit rate is ongoing at the central bank. Meanwhile Meanwhile, the ECB's chief economist Peter Praet said that he sees no reason for the ECB to change course, suggesting that the crisis is not over. Amid concern over rising JGB yields, BoJ board member Ryuzo Miyao said, "Even when there is upward pressure on long-term interest rates due to expectations for economic recovery, monetary policy will continue to put downward pressure on interest rates and therefore strongly support economic recovery." The suggestion being that the BoJ has the ability to tamp yields with more bond purchases. Here in the U.S., doubts remain as to Fed policy moving forward as a result of mixed messages from the central bank. I continue to suspect that there is not really any tightening in the offing (see Friday's DMR), but there seem to be plenty leaning toward a tapering of accommodations, perhaps as soon as later this summer. 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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