Gold Remains Firm on Geopolitical Risks

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Gold's safe haven qualities proven

Gold's 1.51% gain Monday once again demonstrated the metal's safe haven qualities. It was higher in other currencies, notably the euro, and it remained robust Tuesday despite sharp falls in Asian and European indices. Some analysts are warning of a "perfect storm" that could again destabilize the global financial and economic system.

Gold remains firm due to renewed banking system risks, sovereign debt concerns, growing concern of a double dip recession and rising geopolitical tensions on the Korean peninsula. Demand for physical bullion and ETFs remains robust.

Gold's record nominal high of $1,249.40 an ounce, reached on May 14, looks likely to be breached again as Europe's debt crisis remains, with Spain's banking system now under serious pressure. The next price target is the psychological resistance at $1,300/oz.

Silver has dropped from $17.80/oz to $17.60/oz this morning in Asia and Europe, and is currently trading at $17.63/oz, 14.42/oz and 12.33/oz.

Platinum is trading at $1,495/oz and palladium is currently trading at $430/oz. Rhodium is at $2,675/oz.

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