Gold Trades Little Changed Above 2-Month Low in New York
London (Aug 27) Gold was little changed above a two-month low in New York as investors weighed signs of increased physical demand against gains in the dollar and equities.
The metal dropped to $1,273.40 an ounce on Aug. 21, the lowest since June 18, on speculation the Federal Reserve will raise borrowing costs sooner than expected. In China, the world’s largest gold buyer, volumes for the benchmark spot contract on the Shanghai Gold Exchange rose to a four-week high today, the latest data show.
Gold futures rose as much as 1 percent yesterday, even as the dollar strengthened amid expectations for higher U.S. interest rates and global equities gained. Fighting in eastern Ukraine persisted even as Russian President Vladimir Putin said talks with his Ukrainian counterpart over a separatist conflict that’s killed more than 2,000 people were “positive” as the parties began discussions on a political resolution.
“There’s been some scattered bargain hunting by physical buyers,” Bernard Sin, the head of currency and metal trading at MKS (Switzerland) SA, a Geneva-based refiner, said today by phone. While geopolitical tension is helping prices, advances in the dollar and equities are limiting gains for gold, he said.
Gold for December delivery was little changed at $1,285.70 by 7:41 a.m. on the Comex in New York. Bullion for immediate delivery added 0.3 percent to $1,284.99 in London, according to Bloomberg generic pricing.
Futures trading volume was 45 percent below the average for the past 100 days for this time of day, data compiled by Bloomberg show.
U.S. Dollar
The dollar reached an almost seven-month high against 10 major currencies yesterday. Reports showed yesterday a measure of U.S. consumer confidence climbed in August to the highest in almost seven years and durable goods orders rose almost three times as fast as analysts predicted. Global equities climbed to a four-week high yesterday.
Silver for December delivery was little changed at $19.47 an ounce in New York. Platinum for October delivery added 0.3 percent to $1,423.70 an ounce, after touching $1,413.50 yesterday, the lowest since May 1. Palladium for December delivery lost 0.2 percent to $888.50 an ounce. It reached a 13-year high of $902.75 on Aug. 18.
Holdings in palladium-backed exchange-traded products slipped 3.8 metric tons, the most among data going back to 2007, to 91.6 tons yesterday, the lowest since June 5, data compiled by Bloomberg show. Assets rose to a record 95.9 tons on Aug. 4.
Source: Bloomberg
