Gold and silver started the week with sharp rises, after they had declined on Friday. Major commodities such as oil also rallied yesterday. The news of Fitch’s negative outlook on U.S. might influence trades during the day. The Italians plan another debt auction that will start today. This might affect forex and commodities traders especially if the auction won’t go well. Today the U.S consumer confidence report will be published.
Gold rose on Monday by 1.54% to $1,714.5; silver also sharply inclined by 3.70% to $32.24. During November gold declined by 0.6% and silver by 6.1%.
U.S. Budget Cuts – Fitch Changed U.S. Outlook to Negative
The failure of U.S. Super-committee to make Federal budget cuts, started to affect the markets: Fitch, the rating agency, has changed the outlook of the U.S. to negative. This means that even though Fitch still kept the AAA rating of the U.S, there is a greater than 50% chance that Fitch will downgrade the U.S.’s rating within the next two years. Other rating agencies, such as S&P already downgraded the rating of the U.S. so this recent shouldn’t stir up the markets. And yet the markets might react to this news and trade down during the day. If this will be the case, gold and silver might also decline.
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