Gold and Silver Climb Higher as Capital Controls Hit Cyprus
On Thursday, gold (NYSEARCA:GLD) futures for April delivery, the most active contract, increased $6.30 to close at $1,613.80 per ounce, while silver (NYSEARCA:SLV) futures for May jumped 40 cents to finish at $29.21.
Both precious metals climbed higher as the European Central Bank threatened to cut off Cypriot banks on Monday if a bailout deal is not completed. Emergency loans have been funding the insolvent banks, but the debate continues on how to please everyone involved in the bailout.
The original offer included confiscating bank deposits from citizens, which has led to a panic. Lines at the ATM machines are building and Cyprus Popular Bank, the country’s second largest lender, has imposed withdrawal restrictions of 260 euros per customer per day, according to Reuters. The banks in Cyprus have been closed all week.
By the end of the trading day, the SPDR Gold Trust (NYSEARCA:GLD) closed 0.56 percent higher, while the iShares Silver Trust (NYSEARCA:SLV) jumped 1.33 percent. Gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and Yamana Gold (NYSE:AUY) both gained nearly 3 percent. Silver miner Endeavour Silver (NYSE:EXK) surged 5.4 percent.
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Disclosure: Long EXK, AG, HL, PHYS