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Bullard’s Remarks Rattle Bullion Investors; Gold Prices Plunge More Than 2%, Silver Prices Down About 5%

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Gold prices once again headed southwards after James Bullard dropped a bombshell by saying that the Silver prices also plunged in trading on Friday.

At last check, gold futures for December delivery plunged 2.69% to $1,332.40 an ounce while spot gold fell 2.29% to $1,333.11 an ounce.

SPDR Gold Trust (ETF) (NYSE: GLD) was last down 2.28% to $128.76.

Bullion, which was heading towards posting its best weekly performance in last five weeks, pared most of its weekly gains after St. Louis Fed President James Bullard said that the Fed policymakers had a very close call in deciding not to start winding down of asset purchases from September.

Bullard, who is a key voting member in FOMC and ardent backer of ongoing economic stimulating measures, said that the tapering of quantitative easing could be a mild one, if it is started.

Earlier this week, Fed’s Chairman, Ben Bernanke had surprised global investors by not announcing pullback of stimulating measures. The program (bond purchase) “ was not on a preset course” said Bernanke during press conference on Wednesday even as he remained non-committal about the tapering issue.

“Tapering may not have been announced on Wednesday, but it is coming,” said Societe Generale analyst Robin Bhar, according to Reuters.

“Bond yields will carry on going up, and the opportunity cost of holding gold will continue rising” added Bhar.

Silver futures nosedived 5.87% to $21.93 an ounce.

At last check, the iShares Silver Trust (ETF) (NYSE: SLV) was down 4.37% to $21.23, and ProShares Ultra Silver (ETF) (NYSE: AGQ) was down 8.78% to $20.77.








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edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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