8 December, 2016

Gold pushed higher on Wednesday, rebounding from last week’s 10-week low on a combination of dollar weakness, light short covering, coupled with growing nervousness about what the ECB will decide on Thursday. The central bank is expected to extend its asset buying program beyond March of 2017, but participants are unsure about what else the bank could say regarding the overall parameters of its program. Nevertheless, constructive sentiment with regard to the ECB meeting, along with talk about a possible rescue of Monte dei Paschi, seems to have pressured European bond yields lower on Wednesday and helped gold up in the process. Shares in Monte dei Paschi rose by almost 11% and an index of Italian lenders’ shares finished up by 4 1/2%, to their highest level since June. Surprisingly, gold was not adversely affected by another strong rally in the US stock market, where the Dow finished by a whopping 300 points. In other precious markets, silver finished sharply higher, up almost $.40/ounce and is now back over the $17/ounce mark, while platinum gained $6/ ounc