Find Out How EU Concerns Caused Precious Metal Prices To Ease Directly At Precious-Metal.org

February 12, 2010 – Precious metal prices eased back today as concerns lingered regarding the lack of details surrounding an expected bailout of the Greek financial situation. While a statement of understanding is in place for the European Union to assist with Greek recovery efforts, no specific plans have been set forward, allowing fear to creep back into the euro and strengthen holdings in the US dollar.

"Uncertainty... may explain the detachment of gold prices from normally well established currency trading patterns (yesterday)," said an HSBC executive. "How the market assess the aid package may help dictate the path for gold prices near term." The same can be said for silver and platinum, both of which are dropping on today’s markets. At 11:00AM EST, silver had dipped nearly 1.5%, falling 26 cents to $15.35; platinum had lost almost 2%, declining $29.00 to $1,500.00. While the euro lost 0.65% due to the hesitation in the Greek situation, gold slid about .7% to $1,085.90.

"Gold was getting back into the safe haven role, otherwise it couldn't have climbed that far with the dropping euro," said Commerzbank senior trader Michael Kempinski. In spite of gains by the dollar, investors are growing more skeptical about all currencies, meaning that more people are inclined to look at precious metals in the traditional light of a hedge against economic difficulties.

The days ahead are likely to be dictated by lower precious metal prices due to the Chinese New Year and the details coming out of Greece. The market’s view of the aid package may show the direction for metal prices in the near future. While metal prices have eased back, awaiting news on the bailout, gold, silver and platinum appear to be resuming their place as a safe haven asset for many investors. 

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Danny Burns

Senior Staff Writer - Precious-Metal.org