Close X Cookies are necessary for the proper functioning of 24hGold.com. By continuing your navigation on our website, you are accepting the use of cookies.
To learn more about cookies ...
EnglishFrench

UK downgrade knocks sterling

IMG Auteur
 
Published : February 25th, 2013
310 words - Reading time : 0 - 1 minutes
( 2 votes, 5/5 )
Print article
  Article Comments Comment this article Rating All Articles  
0
Send
0
comment
Our Newsletter...
FOLLOW : Coal, Eurozone, Gold Market

24hGold - UK downgrade knocks ...Moody’s announcement late on Friday that it was downgrading the United Kingdom’s credit rating from AAA to Aa1 has had predictable consequences for sterling: the currency sinking to $1.5073, its lowest level since the summer of 2010 (though still considerably above the $1.3733 level reached in March 2009). There was a similar pop in the sterling gold price immediately following the announcement, with the effects spilling over into the main US dollar gold price this morning, with the metal now trading over $1,590/oz. This is the first time the UK’s rating has been cut since 1978.

The pound is now at a 16-month low against the euro (at €1.14), with some predicting parity in this rate by the summer. The Sterling Trade-Weighted Index – which measures the pound against a basket of currencies, weighted by trade volumes – sunk by 1% this morning to its lowest level since September 2011. All of this looks like putting further upward pressure on the UK’s inflation rate, given the country’s still-large current account deficit and the relatively inelastic nature of food and fuel demand.

Is this a game-changer for the gold market? To the extent that it reminds people that – as opposed to the problems in the eurozone – being able to print your own money is no panacea, it should be helpful. Moreover as far as American investors are concerned, there are signs that the UK is the “canary in the coal mine” for the US. As Peter Schiff argues in this interview, the problem can be summed up by the phrase “back to the 1970s”, or the word “stagflation”: declining GDP growth combined with stubbornly high inflation. As Schiff says: “you live by the printing press, you die by the printing press.”

Given these economic pressures, these personal finance and lifestyle tips from GoldReference.org are worth considering (here and here).

Thanks to Goldmoney from www.goldmoney.com
Companies Mentionned : Coal & Allied Industries |
<< Previous article
Rate : Average :5 (2 votes)
>> Next article
Latest comment posted for this article
Be the first to comment
Add your comment
Top articles
World PM Newsflow
ALL
GOLD
SILVER
PGM & DIAMONDS
OIL & GAS
OTHER METALS
Mining Company News
Vena Res.(Ag-Au-Cu)VEM.TO
Provides Update With Regards to the Arbitration Concerning the Azulcocha West Project and Enf
CA$ 0.04-11.11%Trend Power :
Exploration and drilling
Rockwell(Cu-Gems-Ni)RDI.TO
Announces Delay in Annual Meeting and Meeting Date
CA$ 0.20+0.00%Trend Power :
Corporate news
Eldorado Gold(Au-Fe)ELD.TO
Reports 2015 Second Quarter Financial and Operational Results
CA$ 4.35-3.33%Trend Power :
Financials
Endeavour Financial(Ag-Au-Co)EDV.TO
Mining Q2 2015 AISC/oz of $898, Profit of $33M And $20M Debt Payment in July
CA$ 0.52+1.96%Trend Power :
Corporate news
Mawson Res.(Au-Ur)MAW.TO
Restarts Drilling at the Palokas Gold Prospect in Finland
CA$ 0.19+11.76%Trend Power :
Corporate news
Goldcorp(Cu-Le-Zn)G.TO
Achieves Record Quarterly Gold Production; Updates 2015 Cost Guidance
CA$ 17.53+0.46%Trend Power :
Production
Claude Resources(Au-Cu-Ngas)CRJ.TO
Provides Date for Q2 Results and Conference Call
CA$ 0.65+0.00%Trend Power :
Corporate news
Richmond Min.(Ur-Au-Gems)RMD.V
- Exploration Update
CA$ 0.09+0.00%Trend Power :
Corporate news
Arianne Phosphate(Ur-Mo-Ti)DAN.V
Extends the Term of Warrants
CA$ 0.89+1.14%Trend Power :
Financings
Anaconda Min.(Au)ANX.TO
Reports 12.83 g/t Gold Over 4.38 Metres and 8.55 g/t Gold Over 4.97 Metres from Channel Sampl
CA$ 0.04-20.00%Trend Power :
Corporate news
Comments closed