We are witnessing an extremely volatile situation with the price of gold at present. With gold re bounding this week reaching a one month high from previous lows this a volatile period for gold
Why has the gold price reached month highs?
First came a bout of “soft US Data” such as worse than expected US retail sales which lead to the dollar falling.
Then equities took a plunge on the back of a lower dollar, fearful euro news and mounting concerns over Ebola. With over 4000 cases now and despite global leaders avoiding the word outbreak, unless more urgent action is taken some can’t see the virus being known as anything but an outbreak.
Worryingly even Europe’s power house Germany is feeling the pinch and has scaled back its forecast prediction as lower than expected industrial product figures came to light coupled with a downfall in exports.
Furthermore, concerns for Greece have re-surfaced as worries mount over the countries future pre bail out. A credit extension has been suggested but many are keen this option has to have a condition for economic reform attached.
Greece is well known for tax aversion with a reported two out of three Greeks either under estimating their earnings for tax or failing to disclose at all. This activity has led to the Greek economy to be known as a “shadow economy” with so much shady business going on government revenues are pitiful, but is an aggressive tax policy the answer or would this merely lead to further below the belt activities. Add to the mix a possibility of a snap election has added to the support towards gold.