Gold rapidly sheds its gains again after the Greek "No"

The unexpectedly resolute "No" vote in yesterday's referendum has increased the chances of Greece leaving the Eurozone, yet there has been virtually no reaction from the gold price. 

Early gains, though lower than a week ago, have been entirely shed again in the meantime, gold now priced at below $1,170 per troy ounce. At €1,055 per troy ounce, gold is trading almost back at last Friday's level even in euro terms because the euro has recouped nearly all of its losses against the US dollar. 

German Chancellor Merkel will be meeting today with French President Hollande and Eurogroup President Juncker to discuss what should be done next. Another meeting of heads of state and government is scheduled for tomorrow. 

The majority of market participants clearly still expect an agreement to be reached with Greece, allowing the country to remain in the Eurozone. One thing that could help in this context is the resignation of Varoufakis, the controversial Greek finance minister. 

The ECB will make a decision today about emergency loans for Greek banks. Unless lending is topped up, the banks risk running out of money, which would mean a new level of escalation in the debt drama and should lend support to the gold price, says Commerzbank.