Gold is likely to rise on concerns on the EU debt situation as a safe haven investment.
Silver fell, while gold remained unchanged at $1,584.60 in Asian hours. The yellow metal had gained 0.8% yesterday.
Gold, however, has declined approximately 5% since March as cash was investors’ preferred mode.
The U.S. dollar index was higher Monday morning as the greenback bulls have regained upside near-term technical momentum. Meantime, Nymex crude oil futures prices were weaker. Oil prices Friday hit an 8.5-month low of $77.56 a barrel. Crude oil remains in a solid overall bearish fundamental and technical posture. These two key “outside markets” are in a bearish posture for the precious metals markets Monday morning.
The market exhibited a “risk-off” mentality to start the new trading week Monday. European, Asian and U.S. stock markets were weaker as focus is on the European Union’s summit that begins Thursday.
German Chancellor Angela Merkel resisted the concept of euro-area debt sharing to resolve the crisis ahead of a two-day summit of leaders from June. Cyprus became the fifth euro member to seek assistance. Spain yesterday formally requested a fund infusion for its banks. Moody downgraded 28 Spanish banks.
