Gold drops, pares best weekly performance in a month
Sunday, 21 March 2010
LONDON, March 20 (Bloomberg): Gold fell in New York and London, paring its best weekly performance in a month, as a stronger dollar eroded the precious metal's appeal as an alternative investment.
The dollar rose to a one-week high against the euro after Greek Prime Minister George Papandreou said yesterday he may turn to the International Monetary Fund to overcome his nation's debt crisis unless European Union leaders agree to set up a lending facility at a March 25-26 summit. Gold typically moves inversely to the dollar.
"Uncertainty is still weighing on the market, and that's not positive for the euro," said Peter Fertig, the owner of Quantitative Commodity Research Ltd. in Hainburg, Germany. "A weaker euro impacts on precious metals."
Gold futures for April delivery lost $6.10, or 0.5 per cent, to $1,121.40 an ounce at 8:21 a.m. on the Comex in New York. The metal is up 1.8 per cent this week. Gold for immediate delivery in London was 0.5 per cent lower at $1,121.40.
Bullion declined to $1,121.50 an ounce in the morning "fixing" in London, used by some mining companies to sell production, from $1,122.75 at yesterday's afternoon fixing.
The euro fell this week on concern Greece will fail to win EU financial aid. Papandreou has set a one-week deadline for the bloc to find a way of assisting the nation. French President Nicolas Sarkozy and European Central Bank President Jean-Claude Trichet dismissed the IMF option, saying it would show the EU is unable to solve its own crises.
"Prices will be supported as long as economic uncertainties remain and currencies like the dollar and euro stay weak," Liu Yanli, an analyst at Minmetals Futures Co., said from Beijing today. "Gold is on a gradual uptrend."
Bullion futures are up 2.3 per cent this year after climbing 24 per cent in 2010, and reached a record $1,227.50 on Dec. 3. Investor Jim Rogers, who predicted the start of the global commodities rally in 1999, today said he expects gold will be "much higher" in the next decade. He said he's not selling any gold at the moment.
Holdings in the SPDR Gold Trust, the biggest exchange- traded fund backed by bullion, were unchanged for a sixth day at 1,115.51 metric tons yesterday. Gold assets in ETF Securities Ltd.'s European and Australian products fell 6 per cent to 7.17 million ounces yesterday, its Web site showed.
Silver for May delivery in New York lost 0.8 per cent to $17.28 an ounce. Platinum for April delivery fell 0.4 per cent to $1,624 an ounce. Palladium for June delivery added as much as 1 per cent to $483.60 an ounce, the highest price since June 2008, and was last at $479.90.
The dollar rose to a one-week high against the euro after Greek Prime Minister George Papandreou said yesterday he may turn to the International Monetary Fund to overcome his nation's debt crisis unless European Union leaders agree to set up a lending facility at a March 25-26 summit. Gold typically moves inversely to the dollar.
"Uncertainty is still weighing on the market, and that's not positive for the euro," said Peter Fertig, the owner of Quantitative Commodity Research Ltd. in Hainburg, Germany. "A weaker euro impacts on precious metals."
Gold futures for April delivery lost $6.10, or 0.5 per cent, to $1,121.40 an ounce at 8:21 a.m. on the Comex in New York. The metal is up 1.8 per cent this week. Gold for immediate delivery in London was 0.5 per cent lower at $1,121.40.
Bullion declined to $1,121.50 an ounce in the morning "fixing" in London, used by some mining companies to sell production, from $1,122.75 at yesterday's afternoon fixing.
The euro fell this week on concern Greece will fail to win EU financial aid. Papandreou has set a one-week deadline for the bloc to find a way of assisting the nation. French President Nicolas Sarkozy and European Central Bank President Jean-Claude Trichet dismissed the IMF option, saying it would show the EU is unable to solve its own crises.
"Prices will be supported as long as economic uncertainties remain and currencies like the dollar and euro stay weak," Liu Yanli, an analyst at Minmetals Futures Co., said from Beijing today. "Gold is on a gradual uptrend."
Bullion futures are up 2.3 per cent this year after climbing 24 per cent in 2010, and reached a record $1,227.50 on Dec. 3. Investor Jim Rogers, who predicted the start of the global commodities rally in 1999, today said he expects gold will be "much higher" in the next decade. He said he's not selling any gold at the moment.
Holdings in the SPDR Gold Trust, the biggest exchange- traded fund backed by bullion, were unchanged for a sixth day at 1,115.51 metric tons yesterday. Gold assets in ETF Securities Ltd.'s European and Australian products fell 6 per cent to 7.17 million ounces yesterday, its Web site showed.
Silver for May delivery in New York lost 0.8 per cent to $17.28 an ounce. Platinum for April delivery fell 0.4 per cent to $1,624 an ounce. Palladium for June delivery added as much as 1 per cent to $483.60 an ounce, the highest price since June 2008, and was last at $479.90.