Author: Paul Ploumis 12 May 2015 Last updated at 03:48:01 GMT
(Kitco News) - Gold prices ended the U.S. day session with modest losses Monday, pressured by some more chart-based selling amid an overall bearish technical posture, and by mildly bearish “outside markets” that saw a firmer U.S. dollar index and weaker crude oil prices. Gold bulls were disappointed that news of a surprise interest rate cut by China and growing worries about Greece’s debt problems could not prop up the metal’s price Monday. June Comex gold was last down $4.80 at $1,184.10 an ounce. July Comex silver was last down $0.145 at $16.32 an ounce.
China’s central bank lowered its lending and deposit rates by 0.25% each Monday, to 5.1% and 2.25% respectively. It was the third rate cut by China in six months. This is yet another monetary policy easing move by the People’s Bank of China, in an effort to reinvigorate the world’s second-largest economy. Asian stock markets were boosted on the surprise China rate cut. Despite the price weakness in metals today, this news is an overall bullish underlying factor for the precious metals markets and the entire raw commodity sector. China is the world’s largest importer of raw commodities.
Meantime, Greece and European Union/International Monetary Fund negotiations on Greece’s debt restructuring continued Monday, as Tuesday is the deadline for Greece to make a 750 million Euro payment to the IMF. The Euro currency was under pressure Monday due to worries Greece will default on this week’s payment or future debt payments. Short-term Greece government bonds saw yields above 20% Monday, which is not a good signal of European Union investor confidence in Greece surviving in its present form in the EU. Early on today, gold did see some slight safe-haven demand from the situation.
The Bank of England held its interest rates unchanged following its regular meeting Monday. No BOE rate change was expected.
The London P.M. fix is $1,189.25 versus the previous A.M. fixing of $1,184.75.
Courtesy: Kitco News