Fiscal Cliff Worries Drive Gold to $1,731
November 9, 2012
Safe-haven demand for gold has pushed prices higher on the Comex. Kitco reports December gold traded up $5.10 at $1,731.10 an ounce and spot gold was quoted down $1.40 at $1,731.25.
The increase arrives as Obama plans to deliver a speech on the fiscal cliff later today. David Plouffe, a top Obama adviser, believes Obama’s re-election is a mandate to raises taxes on the wealthy, thus ensuring a fight with the Republican-controlled House of Representatives and its leader, Speaker John Boehner, who said on Thursday he is steadfastly opposed to any increase in tax rates.
Dire economic news from the European Union is also driving gold higher. On Friday, the German finance ministry added to projections of a serious economic downturn in Europe by stating that in the months ahead Germany’s economy could “noticeably” weaken. On Thursday, the euro fell to a two-month low against the dollar following a move by the European Central Bank to artificially lower interest rates to 0.75 percent.