On Tuesday investors were looking forward to the outcome of an emergency G7 summit. The world leaders had to hold the urgent meeting amid Europe’s deepening crisis which threatens the global market.
As the latest data shows, the Europe’s largest economy Germany is now witnessing a fall in the economic activity, so there are no doubts that the crisis is flaring up.
Earlier, Vice-President of the European Commission Olli Rehn pleased market participants with a plan to recapitalize Europe’s banks using the European Financial Stability Facility.
At the G7 meeting the policymakers called for introduction of eurobonds. Representatives of Germany that had been against this idea changed their minds. German Finance Minister Wolfgang Schauble together with Bundesbank officials expressed the opinion that a “real fiscal union” would help the European region to combat the debt crisis, and a union must precede the introduction of eurobonds.
The strong news drove the Gold price up. A troy ounce rose to 1627 US dollars.
Analysts expect the price of this precious metal to keep on augmenting. After adverse data on the US labour market was published, investors regard Gold as a reliable asset.