Middle East causes gold-price boom
A New York based financial-services firm INTL FCStone Inc cites two unfolding events that could lead to safe-haven buying of gold.
Protests are occurring in Egypt after decrees from President Mohamed Mursi consolidating power. The country's stock market has tumbled and the Muslim Brotherhood is expected to stage a massive demonstration in support of Mursi, which could set the stage for more violence.
"The Egyptian situation should be largely supportive for gold, as it could fuel further 'safe refuge' buying by Mideast origins," said Edward Meir, commodities consultant with INTL FCStone.
Meanwhile, US lawmakers and the administration still have not resolved the so-called fiscal cliff issue, and much remains to be done.
“Despite all the public bonhomie on display, the various sides are still quite far apart. This will mean that there will continue to be relatively rocky patches ahead for the markets, a scenario that should bode well for gold as a relative safe haven," Meir concluded.