In currencies the NZD has weakened against the USD on light volume, as markets took in concerns about USD funding in Europe, trouble in the Middle East, and an ECB report saying that European banks may have EUR€195 billion in write downs.
This has resulted in an increase in the local gold price rising to NZD$1816.
Looking forward, analysts are predicting increases, especially due to concerns over sovereign debt.
"Gold remains well supported above $1,200 [and] dips are buying opportunities," analyst Walter de Wet of Standard Bank said. "We believe that gold will touch record highs in dollar terms soon and also see it trading above $1,300 in [the third or fourth quarter]."
The interesting thing has been that gold has not been following traditional trends.
Looking forward, analysts are predicting increases, especially due to concerns over sovereign debt.
"Gold remains well supported above $1,200 [and] dips are buying opportunities," analyst Walter de Wet of Standard Bank said. "We believe that gold will touch record highs in dollar terms soon and also see it trading above $1,300 in [the third or fourth quarter]."
The interesting thing has been that gold has not been following traditional trends.
Walter de Wet goes on to say "Financial strain in the eurozone has pushed the euro to successive multi-year lows against the US dollar, sending it as low as 1.2110 on Tuesday. This has not, however, weighed on gold’s movements, with the metal mostly detaching from its historical inverse relationship with dollar/euro fluctuations."
"Since the Greek sovereign debt crisis, we have had a breakaway from the short-term correlation between the dollar and gold," Citi said. "That is because the Greek/European crisis enhances global systemic risk to the financial system (a positive long-term driver for gold)."
