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Gold and Silver Prices Rise after Central Banks Announce Measure to Boot Liquidity in the Financial System

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Gold and silver prices have rebounded sharply today after global central banks, including the Federal Reserve, unveiled measures to boost liquidity in the financial system.

The unprecedented move from central banks comes at a time when the debt crisis in the euro zone is starting to have an impact on the global economy. Apart from the Fed, the other central banks participating in the coordinated action include the European Central Bank (ECB), Bank of Japan, Bank of Canada, Bank of England, and the Swiss National Bank.


Gold and silver prices also got a lift after China unexpectedly cut its bank reserve ration for the first time in almost three years, a sign that the inflation worries in the world’s second largest economy have now eased.

Strong labor market data in the U.S. also pushed gold prices up. According to figures released by ADP, private sector in the U.S. added 206,000 jobs in the month of November, well above economists’ forecast of 130,000.

Commerzbank analyst Daniel Briesemann told CNBC today that in the last couple of weeks gold has been behaving like a risky asset and equities and commodities are up.

At last check, spot gold prices were trading 1.8% higher at $1,746.59 an ounce. Gold futures for delivery in December on the Comex division of the New York Mercantile Exchange rose 1.5% to $1,740 an ounce.

Gold ETFs are also soaring in mid-day trading today. At last check, the SPDR Gold Trust (ETF) (NYSE: GLD) was trading 1.85% higher at $169.97, the Market Vectors ETF Trust (NYSE: GDX) was trading 4.98% higher at $59.27, and the iShares Gold Trust (ETF) (NYSE: IAU) was trading 1.73% higher at $17.02.

Silver prices have also reversed earlier losses and are sharply higher currently. At last check, sport silver was trading 1.03% higher at $32.22 an ounce.

Silver ETFs are also climbing in mid-day trading. At last check, the iShares Silver Trust (ETF) (NYSE: SLV) was trading 3.16% higher at $32.01, and the ProShares Ultra Silver (ETF) (NYSE: AGQ) was trading 6.06% higher at $60.70.

The ProShares UltraShort Silver (ETF) (NYSE: ZSL), meanwhile, is currently trading 6.70% lower at $12.11.

 

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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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