Gold exchange traded funds were slightly lower Tuesday as markets awaited a speech from Federal Reserve Chairman Ben Bernanke. Investors will be listening for any hints of further quantitative easing from the Fed chief.
ETFS Physical Swiss Gold Shares (NYSEArca: SGOL) was down fractionally in early trading Tuesday. Global stock ETFs were also lower on lingering concern over a Greek default and the European debt crisis.
“More optimism surrounding the possibility for more concrete action from European monetary authorities soothed markets slightly last week as Germany moved to ratify the expansion of the European bailout fund late last week,” said analysts at ETF Securities in a weekly update on precious metals. “Nonetheless, the admission from Greece that it will miss previous EU budget deficit targets as part of its latest bailout-linked austerity package highlights that the debt situation remains precarious.”
They also noted precious metal net speculative futures hit their lowest level in over two years last week.
“The position clear-out in gold, silver and palladium could potentially set the stage for short-covering rallies and provide base support for any price gains ahead. Net speculative positions in silver were cut back at the fastest pace in almost half a decade last week,” ETF Securities said in the report.