Gold at two-month high
published : 11 Feb 2014 at 17:39
writer: Bloomberg News
Gold gained to the highest since November in the best run since August as a weakened dollar spurred demand for an alternative asset and physical buying increased. Silver extended the best streak since August.
The Bloomberg Dollar Spot Index, a measure against 10 major currencies, reached a four-week low before Janet Yellen delivers her first testimony to US lawmakers since being sworn in as Federal Reserve chairman. Bullion capped a 1.8% weekly advance on Feb 7 as US jobs growth data missed estimates.
Gold slumped by the most since 1981 last year as some investors lost faith in the metal as a store of value. Bullion rebounded this year as global equities and emerging markets weakened and lower gold prices spurred physical demand. Volumes for Shanghai’s benchmark spot contract surged to a nine-month high yesterday and were today above this year’s average.
"The dollar is under pressure" and that's helping to support gold, Bernard Sin, head of currency and metal trading at bullion refiner MKS (Switzerland) SA in Geneva, said on Tuesday by phone. "Physical demand is starting to pick up. The market is waiting for Yellen’s testimony today.”
One-kilogramme gold bars are seen at Gold Investments Ltd bullion dealers in London on Jan. 15, 2014. (Photo by Bloomberg)
Gold for immediate delivery rose 0.8% to $1,285.17 an ounce by 9.43am in London. It reached $1,287.81, the highest since Nov 18 and is up for a fifth day in the best run since Aug 28. Bullion for April delivery gained 0.7% to $1,284.10 on the Comex in New York, where futures trading volume was 24% above the average for the past 100 days for this time of day, data compiled by Bloomberg showed.
Holdings in gold-backed exchange-traded products rose 1 tonne, the most since Jan 29, to 1,738 tonnes on Monday, data compiled by Bloomberg show. Assets reached the lowest since October 2009 last month. The Fed said last month it will cut monthly bond purchases by $10 billion to $65 billion.
Silver for immediate delivery added 0.5% to $20.1684 an ounce, and an eighth successive daily advance would be the longest since Aug 16. Palladium rose 0.4% to $720.96 an ounce. Platinum gained 0.4% to $1,392.13 an ounce.
Talks to end a strike over pay in South Africa that has crippled production at the world’s largest platinum mines have been postponed until Feb 13 after the companies requested more time. The Association of Mineworkers and Construction Union has called out more than 70,000 workers on a strike that has cost employers about $18 million a day since Jan 23.
In Thailand, the selling price rose by 100 baht to 19,900 baht per one baht weight yesterday while the buying price was 19,800 baht.