Gold Breaks $1,200 Per Ounce Following Weekend Losses
Gold was certainly hit hard over the weekend, but the metal was back with a vengeance on Monday morning. Prices rebounded by more than $35 to break the psychologically important level of $1,200 per ounce. As of 4:09 p.m. EST, gold was trading at $1,212.10 per ounce, up $36.90.
Update: Gold dipped just under $1200 on Tuesday morning, hitting $1,198.20 by 10:14 a.m. EST.Gold was certainly hit hard over the weekend. The yellow metal fell to roughly $1,142 per ounce after Swiss voters rejected a proposal that would have forced the Swiss National Bank to repatriate its gold held abroad and increase its reserves of the metal to 20 percent of all central bank assets. However, gold was back with a vengeance on Monday morning, with prices rebounding by more than $35 to break the psychologically important level of $1,200 per ounce. As of 4:09 p.m. EST, gold was trading at $1,212.10 per ounce, up $36.90. Why the rebound? According to Reuters, some are saying that gold's gains can be chalked up to an overreaction to Sunday's price drop — at least in part. However, that's not all that brought the yellow metal up. A downgrade for Japan's sovereign debt from Moody's sent the yen falling, stimulating additional gold demand. Simon Weeks, head of precious metals at the Bank of Nova Scotia, told the publication, "[t]he market had been focusing on the Swiss referendum, and the reaction to that was overdone on the downside. Then the Japanese rate cut caught a raw nerve." Beyond that, a rally in oil prices also stoked demand for the metal — oil futures were up by approximately 4.8 percent on Monday, as per Bloomberg. Tai Wong of BMO Capital Markets in New York told the news outlet, "[w]hat's driving the gold market here is crude. The move is snowballing as recent short covering and micro-term momentum buyers go long." Not alone To be sure, gold wasn't the only metal to record a positive move on Monday. Both gold and silver futures saw big gains, with silver futures hitting $16.692 per ounce on New York's COMEX. Meanwhile, platinum futures also rose to $1,241.60 per ounce.