Gold Trades Below $1,300 on New Ukraine President, Euro Weakness
Singapore (May 27) Gold traded below $1,300 an ounce as investors assessed whether the election of Ukraine’s president will ease tension with Russia and as the euro weakened against the dollar, reducing the appeal of the commodity.
Bullion for immediate delivery was at $1,292.72 an ounce at 8:53 a.m. in Singapore from $1,292.91 yesterday, according to Bloomberg generic pricing. Gold has risen 7.6 percent this year partly on tension between Ukraine and Russia.
Ukraine’s President-elect Petro Poroshenko vowed to step up operations to rein in separatists in the east of the country as fighting continued after the weekend election. Gold is little changed this month as the euro lost 1.4 percent versus the dollar, reaching a three-month low yesterday, as European Central Bank President Mario Draghi signaled policy makers are ready to add stimulus in June. Dollar-denominated gold becomes more expensive for holders of other currencies when the greenback strengthens.
“Gold remains in consolidation mode below $1,300,” Xia Yingying, an analyst at Nanhua Futures Co., said from Hangzhou, China. “While Ukraine remains a supportive factor, recent euro weakness against the dollar has weighed on gold.”
Gold for August delivery traded at $1,292.70 an ounce on the Comex in New York from $1,291.90 on May 23. U.S. markets were closed yesterday for the Memorial Day holiday and transactions will be booked today for settlement purposes.
Silver for immediate delivery traded at $19.445 an ounce from $19.4351 yesterday. Prices are set to snap two months of losses.
Platinum rose 0.2 percent to $1,479.31 an ounce after climbing to $1,496.38 on May 22, the highest level since September. Palladium was little changed at $833 an ounce after reaching $839 on May 22, the highest since August 2011. The metal is heading for a fourth month of gains in the longest such rally since January 2011.
South Africa’s minister of mineral resources Ngoako Ramatlhodi wants to “find a way of facilitating an agreement” to end an 18-week strike at the mines of the largest platinum producers. South Africa is the world’s biggest platinum supplier and second-largest palladium miner.
