Gold rallies on haven demand; silver up 5%

Gold futures rallied on Thursday as steep losses for U.S. stocks and a decline in the U.S. dollar lured investors into the perceived safety of the precious metal.

… “Pundits out there are touting safe haven demand, and I can’t argue with that,” said Brien Lundin, editor of Gold Newsletter. “The deteriorating situation in Egypt and the selloff in U.S. equities are undoubtedly having an effect.”

“But that effect is being exacerbated by the extreme tightness in the physical gold market,” he said. “As the recent filings have highlighted, western speculators sold their gold this spring, and it’s been shipped to China and elsewhere in Asia. The Asian markets are still buying, and if western traders want to buy gold now, they’re going to have to fight these Eastern savers for every last ounce.”