Gold rallies as dollar advance stalls, boosting demand prospect
Tuesday, 11 August 2009
LONDON, Aug. 10 (Bloomberg): Gold climbed for the first time in four days, reversing an earlier loss, as the dollar's rally stalled, increasing the appeal of the precious metal as an alternative investment. Silver gained for a second day.
Bullion rose as much as 0.2 per cent as the dollar fell against a basket of six major currencies. Gold shed 0.9 per cent on Aug. 7 as the dollar index gained after the US jobless rate in July dropped to 9.4 per cent, the first decline since April 2008. Economists had forecast an increase to 9.6 per cent.
"This is a tug of war between gold prices and the US dollar," Gavin Wendt, a senior resources analyst at Fat Prophets Funds Management, said in an interview today. "It's been an ongoing battle with the US dollar, almost done on a daily basis."
Gold for immediate delivery added 0.1 per cent to $956.30 an ounce at 1:34 p.m. in Singapore. The metal for December delivery fell 0.1 per cent to $958.50 an ounce after trading as low as $953.20 on the Comex division of the New York Mercantile Exchange.
The Dollar Index fell as much as 0.3 per cent to 78.733 before trading at 78.791 at 1:36 p.m. Singapore time. The dollar lost 0.1 per cent to $1.4203 against the euro after gaining 1.1 per cent $1.4183 on Aug. 7, its biggest increase since June 15.
Gold holdings in the SPDR Gold Trust, the biggest exchange- traded fund backed by bullion, decreased 3.97 metric tons to 1,068.90 metric tons as of Aug. 7, according to figures on the company's Web site.
Hedge-fund managers and other large speculators increased their net-long position in New York gold futures in the week ended Aug. 4, according to US Commodity Futures Trading Commission data.
Speculative long positions, or bets prices will rise, outnumbered short positions by 193,514 contracts on the Comex division, the Washington-based commission said Aug. 7 in its Commitments of Traders report. Net-long positions rose by 20,743 contracts, or 12 per cent, from a week earlier.
European central banks agreed last week to a third five- year cap on gold sales and said planned disposals by the International Monetary Fund could be done within the accord.
The European Central Bank and 18 other banks agreed to sell no more than a combined 400 metric tons of the metal a year through September 2014. That's less than the annual cap of 500 tons in the current agreement, which expires Sept. 26.
Among other precious metals for immediate delivery, silver rose 0.4 per cent to $14.68 an ounce, while platinum shed 0.6 per cent to $1,256.25 an ounce. Palladium was up 0.2 per cent at $275.75 an ounce at 1:41 p.m. Singapore time.
Bullion rose as much as 0.2 per cent as the dollar fell against a basket of six major currencies. Gold shed 0.9 per cent on Aug. 7 as the dollar index gained after the US jobless rate in July dropped to 9.4 per cent, the first decline since April 2008. Economists had forecast an increase to 9.6 per cent.
"This is a tug of war between gold prices and the US dollar," Gavin Wendt, a senior resources analyst at Fat Prophets Funds Management, said in an interview today. "It's been an ongoing battle with the US dollar, almost done on a daily basis."
Gold for immediate delivery added 0.1 per cent to $956.30 an ounce at 1:34 p.m. in Singapore. The metal for December delivery fell 0.1 per cent to $958.50 an ounce after trading as low as $953.20 on the Comex division of the New York Mercantile Exchange.
The Dollar Index fell as much as 0.3 per cent to 78.733 before trading at 78.791 at 1:36 p.m. Singapore time. The dollar lost 0.1 per cent to $1.4203 against the euro after gaining 1.1 per cent $1.4183 on Aug. 7, its biggest increase since June 15.
Gold holdings in the SPDR Gold Trust, the biggest exchange- traded fund backed by bullion, decreased 3.97 metric tons to 1,068.90 metric tons as of Aug. 7, according to figures on the company's Web site.
Hedge-fund managers and other large speculators increased their net-long position in New York gold futures in the week ended Aug. 4, according to US Commodity Futures Trading Commission data.
Speculative long positions, or bets prices will rise, outnumbered short positions by 193,514 contracts on the Comex division, the Washington-based commission said Aug. 7 in its Commitments of Traders report. Net-long positions rose by 20,743 contracts, or 12 per cent, from a week earlier.
European central banks agreed last week to a third five- year cap on gold sales and said planned disposals by the International Monetary Fund could be done within the accord.
The European Central Bank and 18 other banks agreed to sell no more than a combined 400 metric tons of the metal a year through September 2014. That's less than the annual cap of 500 tons in the current agreement, which expires Sept. 26.
Among other precious metals for immediate delivery, silver rose 0.4 per cent to $14.68 an ounce, while platinum shed 0.6 per cent to $1,256.25 an ounce. Palladium was up 0.2 per cent at $275.75 an ounce at 1:41 p.m. Singapore time.