Gold price climbs back to $1650 whilst oil and markets claw back gains

6 October 2011 6 October 2011

SylviaHunt30

The price of gold climbed back to $1650 an ounce to the relief of investors who have jumped on the gold rush bandwagon in recent months, whilst stock markets, oil prices and other commodities rally following news that Euro ministers are contemplating a EU wide bank recapitalisation.

Latest Gold Futures Price

Spot gold prices firmed up by almost $8 this afternoon and were trading at $1,649.42 per ounce at in a range bound market even as global stock markets moved up on hopes that the Eurozone’s efforts to prop up its ailing banks could work.

Gold Price – The Low Point?

Despite a volatile spot market over the past couple of weeks, gold prices have not dipped below the $1,600 level for any significant duration of time, suggesting that investors believe that that is a reasonable price point for the yellow metal at this stage.

“Gold has not performed as well as might be expected in the last two weeks given the world’s economic woes.” says one bullion dealer in London.

“Yesterday’s moves highlight the difficulty of making sense of the gold market in the current shaky environment… volatile price action is clearly going to persist.” according to UBS bank.

Gold prices have rallied to a lifetime high around $1,920 in early September after the euro tumbled on doubts over Europe’s ability to solve its debt crisis, but the metal then plunged to a two month low around $1,534 last week as investors cashed in to cover losses in stock markets.

“It seems that short term, gold prices will still be within a range of above $1,600 but below $1,700 an ounce. It’s struggling to find some direction.” said a dealer in Singapore.

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