Precious Metals Market Report
Wednesday 19 April, 2017
Fundamentals and News*
Venezuela Lawmakers Ask Wall Street to Stop Aiding Maduro
Venezuela’s opposition is reaching out to Wall Street banks to dissuade them from helping the country monetize its $7.7 billion in gold reserves.
Venezuela is going to try to stave off default by seeking to swap its gold reserves into cash, and any investment bank that helps will be effectively “supporting a government recognized by the international community as dictatorial,” according to a letter the opposition-led congress sent Monday to top banks. Lawmakers also approved a measure today that they say would nullify any government debt issuance, as well as any debt swaps and pledges of gold as collateral, not explicitly approved by congress.
“The national government, through the central bank, is going to try to swap gold held as reserves for dollars to stay in power unconstitutionally,” according to the letter signed by National Assembly President Julio Borges. “I have the obligation to warn you that by supporting such a gold swap you would be taking actions favoring a government that’s been recognized as dictatorial by the international community.”
Venezuelan President Nicolas Maduro has been battling lawmakers for control over the nation’s finances since the opposition won control of the National Assembly in December 2015 elections, riding a wave of anger over triple-digitinflation and chronic shortages of basic staples. Investors are left trying to gauge the likelihood that the country will continue servicing its debt amid a dollar shortage worsened by the collapse in oil prices.
Lawmaker Angel Alvarado, a member of the National Assembly’s Finance Committee, said the letter has gone to banks including Citigroup Inc., Goldman Sachs Group Inc. and Bank of America Corp.
(*source Bloomberg)
Data – Forthcoming Release
Technical Outlook and Commentary: Gold
Gold for Spot delivery was closed at $1289.76 an ounce; with gain of $5.05 or 0.39 percent at 1.00 a.m. Dubai time, from its previous close of $1284.71
Spot Gold technically seems having resistance levels at 1294.8 and 1300.3 respectively, while the supports are seen at $1276.8 and 1271.2 respectively.
Technical Outlook and Commentary: Silver
Silver for Spot delivery was closed at $18.30 an ounce; with loss of 0.11cent or -0.60 percent at 1.00 a.m. Dubai time, from its previous close of $18.41
The Fibonacci levels on chart are showing resistance at $18.56 and $18.70 while the supports are seen at $18.13 and $ 17.99 respectively.
Resistance and Support Levels
Indications only, open & closing prices are bids; data source: Bloomberg; important disclaimer below; Times as per Dubai
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