A recent Italian bond auction went better than expected but did little to stop the fall of the euro against a strong dollar.
(1888PressRelease) December 31, 2011 - MIAMI, FL - Italy sold over 7 billion euros at rates of 6.98% though Prime Minister Mario Monti warned that the 'financial turbulence' was not over. In fact the auction fell short of the target of 8.5 billion euros but was nevertheless seen as a positive forward move. Perhaps more importantly, the ECB stepped in to buy some of Italy's bonds following the auction, easing some of the pressure on Italy's new Prime Minister who successfully pushed an austerity and growth package worth 30 billion euros through the Italian parliament last week.
The falling euro served to highlight the stronger dollar, which is having the effect of pushing the price of gold lower. The final week of 2011 has indeed been aberrant; a week that is normally quiet and ineffectual has seen a sharp decline in the price of all of the precious metals with even palladium suffering a small loss. The market now awaits the opening weeks of 2012 to see which direction precious metals will move in.
"Forecasts for 2012 are relatively positive for precious metals bullion despite the recent fall in prices," says Bill Hionas of Pan American Metals of Miami. "Market watchers and financial experts predict a continuance of gold's bull run in 2012 and renewed investor interest in silver. Palladium should benefit from the supply / demand ratio and platinum, which did relatively poorly in 2011 is due a comeback."
If the Italian rescue package is effective and the euro starts 2012 with a comeback, then we can expect to see the price of gold rebound likewise.
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Pan American Metals of Miami, LLC is a group of traders, investors and account executives that combines many years of experience to help clients invest in bullion. PAMM provides an individual investment service and is based in Miami, Florida for convenient access to both North and South American investors.
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A recent Italian bond auction went better than expected but did little to stop the fall of the euro against a strong dollar. 
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