Angela Merkel rejected the idea of raising the cap on the bailout fund.
(1888PressRelease) December 14, 2011 - MIAMI, FL - German Chancellor Angela Merkel added a further note of pessimism to the prevalent atmosphere following the European summit when she rejected the idea of raising the limit on Europe's bailout fund at the next summit, scheduled for March 2012.
Eyes are now turned away from Europe and back towards the US where the Federal Reserve is holding its last meeting for 2011 today, December 13. No interest rate changes are anticipated as a result of this meeting but gold watchers will be scouring the details for any hint of quantitative easing, which would be bullish for gold.
"Gold has now stabilized following the European summit, which was clearly disappointing in many ways," says Bill Hionas of Pan American Metals of Miami. "Any hint of quantitative easing from the Federal Reserve would send gold prices up again, so the market will be paying close attention to the outcome of that meeting."
Gold is suffering from end-of-year selling as well as from being linked to the euro, which has taken quite a beating lately. The general consensus is that the plan resulting from Friday's summit meeting does not offer enough definitive action to solve the euro zone's debt issues. Many market experts are surprised that gold is not trading significantly higher in view of the economic turmoil in Europe but the yellow metal seems to be struggling to regain its traditional role as a safe haven. Investors may need to exercise patience; the price of gold is predicted to rise early in 2012 and the current price may well offer an excellent buying opportunity.
Pan American Metals of Miami, LLC is a group of traders, investors and account executives that combines many years of experience to help clients invest in bullion. PAMM provides an individual investment service and is based in Miami, Florida for convenient access to both North and South American investors.