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Euro spike pushes dollar down and boosts gold

The gold price has risen to a three-week high in the wake of the European Central Bank monetary policy meeting. Spot gold reached $1,247.20, a level not seen since the end of June. It represents a gain of over $10 compared to yesterday’s price of $1,236.29.
 
This price increase comes as the dollar reached an 11-month low measured against a basket of currencies. The strong performer was the euro, which reached a 14-month high after European Central Bank (ECB) president Mario Draghi said policymakers would review the bank’s bond buying scheme in autumn.
 
Reuters quoted Mitsubishi analyst Jonathan Butler, who commented that Draghi’s speech was dovish in nature, but with flexibility for change. “The ECB will defer the decision on QE tapering until the autumn  the euro gained ground on this news and the resulting fall in the dollar helped gold recover from some of its earlier losses,” he said.
 
There has been uncertainty over the direction the ECB is heading; the Federal Reserve has been cranking up rates slowly, and the Bank of England’s Monetary Policy Committee have recently entertained a more hawkish stance. However, one of the factors stopping the ECB driving up interest rates has been the low levels of inflation on the continent. 
 
In mining news, Acacia Mining is running into trouble again. Tanzania has asked foreign employees of the London-listed firm to leave the country. This comes after the company reported a dip in productivity and earnings.
“The first half [of the year] has posed significant challenges to our operations in Tanzania following the introduction of the concentrate export ban in March and I am pleased with how we have performed in light of this,” chief executive officer Brad Gordon said to Foxbusiness

Acacia had previously run into difficulties with operating in Tanzania after the government accused the company of evading taxes and operating illegally, threatening a takeover. They had also suffered from a ban on exports of gold and copper from the country. 
Photo Credit: stevanovicigor

Link to this article: : http://www.goldmadesimplenews.com/gold/euro-spike-pushes-dollar-down-and-boosts-gold-13286/

Posted by on Jul 21 2017. Filed under Gold News, Markets. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.

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