Germany and the UK Government is ready to design a budget deficit reduction up to 40% for the period 2010-2014, as part of fiscal consolidation efforts. Budget blueprint released by the Ministry of Finance of Germany, as reported by Bloomberg today, shows a total decline in the German budget deficit in 2010 – 2014 of about 137 billion euros. Thus, the total budget deficit is expected to touch 218.5 billion euros for 2010 to 2014. This is down from the draft budget deficits created in July 2009, amounting to 355.4 billion euros.

In the show Andrew Marr Show on BBC 1 television station, British Transport Minister Philip Hammond reveals UK Treasury has ordered the majority of the ministers to make deficit reduction scenario of 25% and 40% for four years. Coalition of Conservative and Liberal Democratic Party central England proposes cutting spending and raising taxes by the amount of 113 billion pounds (U.S. $ 172 billion) to reduce the budget deficit which is currently 11% of GDP.

“We’re not going to cut 25% uniformly in every department. Indeed there is no department that should reduce spending fully 40%, but some departments may need to cut a little larger than 25%, “explained Hammond. (more…)

Enchantment of the gold price has not faded. This year analysts expect gold prices likely through 1300 U.S. dollars per troy ounce. The investors would transfer the funds from currency into precious metals.

Analyst with Standard Bank Plc, Bruce Ikemizu, rate, euro currency and the United States dollar might lose its appeal. Therefore, economic conditions in developed countries are still below the emerging market countries like China.

Currently there are no investment instruments that are fitted to replace the U.S. dollar and euro. Thus, according Ikemizu, the choice is gold.

“The U.S. no longer dominates the world economy. Now that drives the global economy is the growth of developing countries,” said Ikemizu in Japan, as quoted by Bloomberg, last week.

In trading on the New York Mercantile Exchange Friday (6/18/2010), the gold price in August delivery closed down 9.60 dollars scoop on 1258.30 dollars per ounce. This is the highest position in history. Even in the daily trading price of this precious metal touched a record high of 1263.70 U.S. dollars daily.

The current price for gold delivery, closed at 1257.20 dollars per troy ounce.