After the storm passed, precious markets Wednesday revived in New York, with gold up USD 11.20 through afternoon trading, with silver up 50 cents, or 1.6%.
Pent up demand driven by bargain hunters and short covering investors sent gold, silver and the other precious metals up Wednesday, despite trading that is still on the thin side because of the storm's effects.
There was also some good news for gold insofar as the EU and Greece seem to be finally moving toward a resolution of that small country's financial difficulties. That would mean a strengthening of the euro, generating a negative pressure on the dollar, and therefore positive for gold.
German Finance Minister Wolfgang Schaeuble stated that "there was considerable progress" among the Euro zone members toward reaching a conclusion of reforms that Athens must implement to receive new emergency loans, Reuters observed. "The decisive phase for Greece has started," believes Carsten Bzerski, a Brussels-based senior economist at ING Group.
Elsewhere in Europe, Germany's retail sales scooted up 1.5% in September, also boosting the euro. If Greece follows through, it is more likely Spain can resolve its problems.
The prospect of an unforeseen stimulus effect due to the ravages of Hurricane Sandy helped to push gold higher, too. The USD 25 to USD 30 billion (thus far) in property damage will have to be addressed, and though some of the re-building money will come from private insurers, much of the financing will come through federal and state borrowing. (What else?)
Expect the next few days to remain sluggish ahead of US employment figures on Friday and because of the waiting game we are all playing regarding the upcoming US elections and change of leadership in China.
However, from our vantage point, the lynchpin for gold, and all matters economic, appears to be Europe.
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