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Gold extends gains after central banks’ move

Posted By admin On September 18, 2008 @ 3:45 am In Money Watch | Comments Disabled

Risa Maeda
Reuters [1]
Thursday, Sept 18, 2008

Gold rose on Thursday after a coordinated effort by central banks to stabilize the dollar, consolidating bullion’s biggest-ever one-day rise the previous day and ensuring its status as a safe-haven asset was intact.

The Federal Reserve and the world’s top central banks offered to pump billions of dollars into global money markets on Thursday in a coordinated effort to ease a funding squeeze triggered by the upheaval on Wall Street.

The concerted action follows a rout in financial markets, roiled by fears of more Wall Street failures in a week that has seen Lehman Brothers file for bankruptcy, Merrill Lynch lose its independence and a $85 billion U.S. government bailout of insurer AIG.

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“Doubts stay over the dollar after the central banks’ move,” said Tatsuo Kageyama, analyst at Tokyo-based Kanetsu Asset Management Co.

“The question — who’s going to be the next — is still hanging over. Even if the dollar rose, people would think that is just a temporary rise,” he said.

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URLs in this post:

[1] Reuters: http://www.reuters.com/article/goldMktRpt/idUST9440920080918

[2] Gold extends gains to 2-month high as panic grips: http://www.prisonplanet.com/gold-extends-gains-to-2-month-high-as-panic-grips.html

[3] Central Banks Buy the Most Gold Since 1964: http://www.prisonplanet.com/central-banks-buy-the-most-gold-since-1964.html

[4] Gold Rises to Record, Silver Extends Gains on Currency Declines: http://www.prisonplanet.com/gold-rises-to-record-silver-extends-gains-on-currency-declines.html

[5] Central banks favor gold as crisis unfolds: http://www.prisonplanet.com/central-banks-favor-gold-as-crisis-unfolds.html

[6] Central Banks Net Buyers of Gold for 1st Time in 20 Years: http://www.prisonplanet.com/central-banks-net-buyers-of-gold-for-1st-time-in-20-years.html

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