I don't understand the reasoning. Euro-zone optimism... should cause the buying of euros, not gold. Shouldn't it?
I'd think that euro-zone pessimism... i.e. pessimism about the world economy... would drive gold up. But the opposite is happening.
As I said, I don't get it.
July 25, 2012, 10:28 a.m. EDT
Gold climbs on guarded euro-zone optimism
By Claudia Assis and V. Phani Kumar, MarketWatch
SAN FRANCISCO (MarketWatch) — Gold futures advanced Wednesday as some optimism regarding the euro zone’s debt crisis emerged after a European Central Bank official suggested he saw merit in giving the region’s bailout fund a banking license.
Gold for August delivery rose $24.30, or 1.5%, to $1,600.50 an ounce on the Comex division of the New York Mercantile Exchange.
The metal traded as high as $1,606.40 an ounce earlier, arriving at a key psychologically important level. Gold hasn’t settled above $1,600 since early July.
The gains came as the U.S. dollar backed off a two-year high against the euro and was weaker against major currencies.
That followed comments from an European Central Bank member that the ECB could apply for a banking license.
More: http://www.marketwatch.com/story/gold-futures-climb-as-the-euro-gains-on-dollar-2012-07-25
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