Gold and silver were way down Tuesday morning as eurozone worries increased. It seems that governments and central banks in Europe and Japan have a full-fledged fight against deflation on their hands, which doesn’t augur well for the U.S. or Chinese economies and banking systems.
Spot gold was down 2.12%, bid at $1,603.70 as of 10:48 p.m., having traded as high as $1,626.30 and breaching $1,600, to $1,598.20, on the low side, according to Kitco market data. The London afternoon reference price was set at $1,602.50, down a whopping $41.50 an ounce from Monday’s afternoon reference price.
Spot silver was showing a 2.53% loss, bid below $30 an ounce at $29.33. The morning high as of time of writing was $29.77 and the low was $29.14. Tuesday’s reference price was set at $29.58 an ounce, 32 cents an ounce lower than Monday’s price fix.
The ICSC-Goldman same-store sales index for major retail chains dropped sharply in the April 5 week, declining 0.8% and down 3.3% year-to-year.
U.S. consumers are borrowing more. Consumer installment debt rose at a seasonally adjusted 10.2% rat,e to $2.54 trillion, in March from February, the Federal Reserve reported Monday, the biggest increase since November 2011. The figure doesn’t include mortgages.
German industrial output took a sharp turn for the better in March as industrial production rebounded, rising 2.8%, well above a consensus 1% increase.
Eurozone politics have taken center stage as France and Greece held elections this past weekend. France’s new president, Francois Hollande, stated that he wants to renegotiate the EU’s fiscal treaty, which German Prime Minister Angela Merkel refused to do. The center-right New Democracy Party and the Coalition for the Radical Left, the two parties that finished first and second in Greece’s national election, were unable to hammer out coalition governments yesterday.
The Spanish government of PM Mariano Rajoy is reversing course and is now preparing a bailout of Bankia, the country’s third-largest bank by assets, that could total as much as 7 billion-10 billion euros (~$9.1 billion-$13 billion).
Gold bullion prices fell to $1,601 an ounce in London morning trading Tuesday, down 2.5% from last week’s close, BullionVault reported. Today’s move blew through technical support identified by traders at $1,625.
Gold and silver trusts were falling hard and fast.
Gold and silver mining ETFs also were dropping fast.
The Market Vectors Gold Miners ETF (NYSE:GDX) was showing losses of around 3.9%.
The Market Vectors Junior Gold Miners ETF (NYSE:GDXJ) was down around 5.4%.
The Global X Silver Miners ETF (NYSE:SIL) was down around 4.25%.
Gold mining shares were showing sharp, deep losses.
Agnico-Eagle Mines (NYSE:AEM) was down around 4.16%.
Barrick Gold (NYSE:ABX) was down around 4.3%.
Eldorado Gold (NYSE:EGO) was down around 6.25%.
Goldcorp (NYSE:GG) was down around 4.3%.
Kinross Gold Corp. USA (NYSE:KGC) was down some 4.7%.
Newmont Mining (NYSE:NEM) was around 3.15% lower.
NovaGold Resources (NYSEAMEX:NG) was down around 9.7% lower.
Yamana Gold (USA) (NYSE:AUY) was down more than 4.8%.
Silver mining shares were getting hammered down as well.
Coeur d’Alene Mines (NYSE:CDE) was around 4.1% lower.
Hecla Mining (NYSE:HL) was around 1.3% lower.
Pan American Silver (NASDAQ:PAAS) was showing losses of around 3.7%.
Silver Wheaton (NYSE:SLW) was down around 3.6%.
Silver Standard Resources (NASDAQ:SSRI) was down some 4.5%.
As of this writing, Andrew Burger did not hold a position in any of the aforementioned securities. Adrian Ash of BullionVault contributed to this report.