Technical Level, Gold Climbs to Highest This Month on Dollar
Gold climbed to the highest level this month in New York after the dollar’s decline and bullion’s advance above $1,320 an ounce spurred more purchases.
The metal advanced 4.2 percent since reaching a three-week low of $1,271.80 an ounce on Aug. 7. The Bloomberg U.S. Dollar Index, a measure against 10 major currencies, rose for the first time in more than a week after reaching a seven-week low Aug. 8.
Gold for December delivery rose as much as 1.6 percent to $1,333 an ounce, the highest since July 31, and was at $1,325.60 by 7:42 a.m. on the Comex in New York. Photographer: Alessia Pierdomenico/Bloomberg
Aug. 12 (Bloomberg) -- Dominic Schnider, head of commodities research at UBS AG’s wealth-management unit in Singapore, talks about the outlook for precious metals and crude oil. Schnider also discusses aluminum prices. He speaks with Rishaad Salamat on Bloomberg Television's "On the Move." (Source: Bloomberg)
Gold fell into a bear market in April and is down 21 percent this year as some investors lost faith in the metal as a store of value and inflation failed to accelerate amid unprecedented money printing by central banks. Charles Evans, Sandra Pianalto and Richard Fisher, regional Federal Reserve presidents in Chicago, Cleveland and Dallas, said last week the Fed may be closer to tapering debt buying as the jobs market recovers.
“On the back of a relatively lower dollar we went through the $1,320 level,” Afshin Nabavi, a senior vice president at bullion refiner MKS (Switzerland) SA in Geneva, said today by phone. “Buying above the $1,320 level pushed it up. On Friday we had good physical interest and today that’s been quieter” amid higher prices, he said.
Gold for December delivery rose as much as 1.6 percent to $1,333 an ounce, the highest since July 31, and was at $1,325.60 by 7:42 a.m. on the Comex in New York. Futures trading volume was 8.2 percent below the average for the past 100 days for this time of day, according to data compiled by Bloomberg. Gold for immediate delivery in London gained 0.9 percent to $1,326.38.
Gold exchange-traded product holdings rose 1.4 metric tons to 1,948.3 tons on Aug. 9, the first increase this month, data compiled by Bloomberg show. Assets are down 26 percent this year and reached a three-year low of 1,946.9 tons on Aug. 8.
“What we need to maintain the current gold price level is actually inflows,” Dominic Schnider, head of commodities research at UBS AG’s wealth-management unit in Singapore, said on Bloomberg Television today, predicting lower prices in the next three to six months. “What’s really saved us so far on the consumer side in emerging markets has been China.”
China’s gold consumption rose 54 percent to 706.4 tons in the first half of 2013 from a year earlier, the China Gold Association said today. Gold-bar purchases surged 87 percent and jewelry demand gained 44 percent, it said.
Silver for September delivery climbed 2.4 percent to $20.895 an ounce in New York, reaching $21.26, the highest since June 20. Palladium for September delivery lost 0.1 percent to $740.40 an ounce, after touching $747, the highest since July 29. Platinum for October delivery set a two-month high of $1,510.80 an ounce and was last little changed at $1,499.30. (Bloomberg)