Gold & Precious Metals Weekly
Merrill Lynch
Date: August 20, 2007
Gold Markets - Global commodities sinkAfter a rollercoaster ride, the gold price sunk 2.4% to close Friday at $656/oz while silver dropped 8.7% to close at $11.74/oz. Although gold traded within a tight range during the first half of the week, it eventually succumbed to selling pressures on Thursday, plunging some $25 at its low, as global credit concerns wrecked havoc on the global commodity markets. However, gold rebounded on Friday, recovering some of its earlier losses as the Federal Reserve cuts its discount rate from 6.25 to 5.75% causing the US$ to weaken against foreign currencies. Similarly to the WGC (World Gold Council), we remain confident in the fundamentals of the gold market, and continue to expect that gold will trade to the $700-$725/oz level by early fall.
The above information is as it originally appeared in Merrill Lynch’s Gold & Precious Metals Weekly August 20, 2007.
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