Make no mistake, yesterday's new policies from Mario Draghi and the European Central Bank (ECB) were a last ditch attempt to fight against deflation, and perform a backdoor bailout of several insolvent banks. And what was most interesting was how the markets reacted in a way which shows that no one trusts central banks anymore to be competent to resolve economic problems, and this was seen inexplicably in the Euro currency and in gold prices.
In fact, going through the end of U.S. trading and into the first few hours of Asian trading, gold soared to its highest level in 13 months, hitting an intra-day high of $1282.
Gold prices climbed to a 13-month high in dollar terms overnight ($1,282.51) after the increasingly adventurous, dare one say reckless, European Central Bank unleashed its latest ‘bazooka’ and initiated more interest-rate cuts, a significant extension in currency printing and bond purchases and also a potential subsidy to banks lending. - Goldcore