Gold Rises Nearly 2 Percent on Greece Bailout Optimism
Reuters
Gold prices rose 1.5 percent on Tuesday for their biggest daily gain in two weeks, as expectations that a Greek rescue deal will be completed drove the dollar down sharply against the euro.
Bullion, which had dropped in early trade on nervousness about Greece, rebounded to snap two days of losses as Greece's government was preparing a list of reforms needed to clinch a new financing package.
Hopes for a bailout plan that would move Athens closer to avoiding a chaotic debt default boosted gold's inflation-hedge appeal. The metal's rally also sharply outpaced Wall Street's gains.
"If the deal falls apart, the ECB (European Central Bank) is going to be even more aggressive in monetizing things and create credit to insulate the banking system from a disorganized default," said James Dailey, portfolio manager of the TEAM Asset Strategy Fund.
"It's basically a win-win for gold at this point," he said.
Spot gold was up 1.6 percent at $1,746.64 an ounce by 2:49 p.m. EST (1949 GMT). In early trade, gold had dipped as low as $1,709.29, near a two-week low.
U.S. gold futures for April delivery settled up $23.50 at $1,748.40. Trading volume was 15 percent below its 30-day average but largely in line with the recent pace.
Silver climbed 1.8 percent to $34.22 an ounce.
After briefly entering a bear market in December, gold has risen about 10 percent so far this year, surging last month after the U.S. Federal Reserve said it would keep interest rates near zero at least until late 2014 and stood ready to offer extra economic stimulus.
Officials worked on the draft of a text on the 130 billion euro ($172 billion) bailout plan that will be put to Greek leaders for approval. The metal stayed higher even after the meeting to discuss the rescue plan was postponed to Wednesday.
"If we do get a resolution of the current standoff, then gold will likely benefit," said Anne-Laure Tremblay, an analyst at BNP Paribas.
Heavy buying of bullish option strategies and an eight-week high in the euro also lifted gold, traders said.
Michael Matousek, senior trader at U.S. Global Investors, which has over $2 billion in mutual-fund assets, said hopes for a Greek bailout deal had rekindled fears about money printing by central banks, which boosted gold buying.
Gold's gain was also fueled by a technical rally after it broke key resistance at a downtrend line at $1,680 an ounce in late January, analysts said.
On Tuesday, gold's rally gained pace after it breached the previous session's high around $1,735 an ounce.
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Gold Rises to Two-Month High, Eyes U.S. Payrolls
Reuters
Gold rose on Thursday for a third consecutive day on a larger-than-expected fall in new U.S. claims for unemployment benefits, but analysts said bullion could pull back due to an upcoming U.S. jobs report.
Bullion hit a two-month high, reversing initial losses after encouraging jobless claims data pointed to a recovery jobs market, ahead of the closely watched January U.S. nonfarm payrolls report on Friday.
The precious metal has risen nearly 12 percent this year, as gains accelerated after the U.S. Federal Reserve said last week it would hold interest rates near zero until at least late 2014.
"If you get a disappointing nonfarms tomorrow, you may see a flight into short-term market U.S. dollar securities. That tends to create a corrective action in stocks and in precious metals," said Richard Hastings, macro strategist at investment bank Global Hunter Securities.
Spot gold was up 0.8 percent at $1,757.70 an ounce by 11:59 a.m. (1659 GMT), having earlier peaked at $1,760.70, its loftiest since December 2.
U.S. gold futures for April delivery rose $11.50 an ounce to $1,761.
Silver was up 1.2 percent at $34.10 an ounce.
U.S. employment growth probably slowed in January as temporary workers hired during the holiday shopping season were laid off, but the improving labor market trend should remain intact. A Reuters survey shows nonfarm payrolls to rise 150,000 in January after increasing 200,000 in December.
"We expect gold to reach new highs in 2012, although episodes of extreme risk aversion may trigger corrections along the way," said Anne-Laure Tremblay, an analyst at BNP Paribas.
Tremblay said the recent rebound in risk appetite has encouraged gold buying, and anecdotal evidence suggests that bar and coin demand remains high in the U.S. and Europe.
Worries over the euro zone debt crisis had driven gold sharply higher for much of last year even as they weighed on the euro. Towards the end of the year, however, the metal behaved more like a commodity, following equities lower as risk appetite retreated.
The market largely ignored official data showing gold output in China, the biggest global producer of bullion, rose to a record 360.95 tonnes last year. Its domestic demand for gold far outstripped that figure, however.
Gold Rises to Two-Month High as Fed’s Bernanke Says U.S. Economy Improving
Bloomberg
Gold rose to a two-month high after Federal Reserve Chairman Ben S. Bernanke said he sees signs the U.S. economy is improving, boosting prospects for commodity demand.
“Indicators of spending, production, and job-market activity have shown some signs of improvement,” Bernanke said today in prepared testimony to the House Budget Committee in Washington. Improving growth prospects will help buoy gold as “deflationary concerns subside,” said Scott Gardner, the chief investment officer at Verdmont Capital SA in Panama.
“When economic news comes in better than expected, it boosts commodities, including gold,” Gardner said in an e-mail.
Gold futures for April delivery gained 0.6 percent to settle at $1,759.30 an ounce at 1:35 p.m. on the Comex in New York, after reaching $1,763.80, the highest since Dec. 2. The metal climbed 11 percent last month, the biggest January rally since 1983.
Gold also got a boost from investors seeking a haven against inflation, after Bernanke cautioned that the U.S. outlook is still “uncertain,” boosting speculation that the Fed will increase stimulus measures to continue the expansion. Last month, the central bank pledged to keep the benchmark U.S. interest rate low until at least late 2014.
“People are speculating that very soon the Fed may talk about quantitative easing,” Sterling Smith, an analyst at Country Hedging in St Paul, Minnesota, said in a telephone interview.
Silver futures for March delivery climbed 1.1 percent to $34.175 an ounce in New York, after touching $34.35, the highest since Nov. 16.
On the New York Mercantile Exchange, platinum futures for April delivery advanced 0.4 percent to $1,629.90 an ounce, climbing for the second straight day. Palladium futures for March delivery rose 1.6 percent to $707.65 an ounce, jumping the most in more than a week.
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Gold Closes Higher on Positive Market Sentiment
MarketWatch
Gold futures advanced Wednesday as the dollar weakened and U.S. stocks traded higher, lifting the tide for gold and other metals.
Gold for April delivery added $9.10, or 0.5%, to settle at $1,749.50 an ounce on the Comex division of the New York Mercantile Exchange.
That was gold’s highest settlement since early December and a second straight day of gains for the metal.
Gold’s been enjoying “a slow and steady advance” in recent sessions, said Frank Lesh, broker and futures analyst with FuturePath Trading in Chicago.
“You don’t want too much, too fast,” he said. “A lot of the trading right now is about risk-on, risk-off, and with equities doing well we see an easier advance for gold.”
U.S. stocks and most markets cheered positive data on Europe’s manufacturing, and, closer to home, a report that showed improvement in private-sector employment for January, contributing to gains for most markets on Wednesday.
Overnight in Asia, data showed a mixed picture of manufacturing activity in China.
Underpinning the support for gold, the ICE dollar index, which tracks the greenback against six rival currencies, declined to 78.881, down from 79.278 late Tuesday.
A weaker greenback is a positive for dollar-denominated commodities as it makes them less expensive to holders of other currencies.
The broader metals complex traded higher, overcoming some weakness seen during Asian trading hours, with platinum leading the way.
Platinum for April added $35.10, or 2.2%, to $1,623.20 an ounce, while March palladium gained $10.35, or 1.5%, to $696.70 an ounce.
March silver rose 55 cents, or 1.6%, to $33.81 an ounce.
March copper advanced 5 cents, or 1.4%, to $3.84 a pound.
HSBC’s Chinese manufacturing survey remained stuck in contraction in January, while the government version indicated the sector is now growing.
Payroll processor Automatic Data Processing Inc. said Wednesday a survey indicated U.S. private-sector payrolls rose 170,000 in January, marking the second year of job gains for the private sector.
Separate data on manufacturing from Germany, the U.K. and the euro zone also came in positive, giving markets another layer of support.
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Gold Rises on Economic Optimism, Eyes Pullback
Reuters
Gold rose on Wednesday as the dollar slipped against the euro and on strong global manufacturing data, while analysts said profit-taking could pressure the precious metal after its biggest January gain in 32 years.
Bullion followed a Wall Street rally after data showed U.S. manufacturing growth rose to its fastest level in seven months. China's factory sector also expanded, and Germany recorded its first rise in manufacturing output in four months.
Gold was poised for its fifth straight weekly gain, and some analysts said they expected some profit-taking to pressure prices in the near term after an 11 percent rise in January.
"Gold has been up for weeks. It is probably a stretch now and ripe for some profit-taking, but the technical and fundamental factors are not signaling a reversal yet," said George Gero, vice president of RBC Capital Markets.
Spot gold added 0.4 percent at $1,744.16 an ounce by 2:55 p.m. EST (1955 GMT).
U.S. gold futures for April delivery settled up $9.10 at $1,749.50 an ounce. Trading volume was slower than its recent pace and about 70 percent below the 30-day average.
The precious metal's 11 percent rise in January was its largest monthly gain since August. The rally gained pace after the Federal Reserve said last week it would likely keep U.S. interest rates near zero at least until late 2014, and as the euro zone debt crisis showed no sign of abating.
"We are overbought quite significantly ... so there will be some kind of consolidation," said Ole Hansen, senior manager at Saxo Bank.
Gold has risen nearly 15 percent since it hit six-month lows in late December, when it briefly entered a bear market as it retreated from an all-time high above $1,920 an ounce set in September 2011.
U.S. PAYROLLS, EURO IN FOCUS
Peter Fertig, consultant at Quantitative Commodity Research, said gold could extend its rally if Friday's U.S. nonfarm payrolls data does not disappoint.
Holdings of the metal in exchange-traded funds rose by over 650,000 ounces in January, the first month of net inflows in two months.
Silver put on 1.9 percent at $33.77 an ounce. The silver price rose nearly 20 percent in January, its largest monthly rally in nine months.
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Gold Rises for Third Day After Soft U.S. GDP Data
Reuters
Gold prices rose on Friday, on track for their biggest three-day rally since late October, after a report showing disappointing U.S. economic growth boosted the metal's safe-haven appeal.
Bullion rose above $1,730 an ounce for the first time in seven weeks after data showed the U.S. economy grew less than expected in the fourth quarter. Gold's gains extended a rally ignited on Wednesday when the Federal Reserve said it would likely keep interest rates near zero until at least late 2014.
Gold also got a boost from reports that the world's biggest hedge fund, Bridgewater Associates, was bullish on the precious metal as a hedge against inflation as governments print more money to reduce debt.
"With the softer-than-expected GDP reading, it means that at a minimum we are going to have a highly accommodative monetary posture," said Mark Luschini, chief investment strategist of Janney Montgomery Scott, a broker-dealer with about $54 billion in assets under management.
"That should be supportive of the higher gold price, as it plays into the probability that QE3 may be in the offing," Luschini said.
Spot gold was up 0.7 percent at $1,731.59 an ounce by 12:32 p.m. EST (1732 GMT). It is up around 4.5 percent this week alone, its biggest one-week gain since the last week of October.
U.S. gold futures for February delivery were up $4.80 at $1,731.50 an ounce at a strong volume.
Technical buying also fueled gains. Earlier in the week, gold broke above a key Fibonacci retracement level and the 100-day moving average. Gold rose above its 200-day MA last week.
Gold is on track to rise more than 10 percent this month, its biggest monthly gain since August 2011.
Explaining gold's big gains this week, analysts pointed to the Federal Reserve's announcement that it would keep rates low into 2014.
"The Fed's announcement that it would keep its rates exceptionally low until 2014 was ... clearly not fully priced by the market," said BNP Paribas analyst Anne-Laure Tremblay.
"Real interest rates are likely to stay negative in the U.S. in the next two years, which will be supportive of the gold price," Tremblay said.
Low interest rates benefit zero-yielding gold, and minimal borrowing costs also tend to fuel a gradual increase in commodity prices, supporting the metal's traditional role as a hedge against inflation.
Also helping gold was a weaker dollar versus the euro and stronger crude oil prices.
FED MOVE NEW CATALYST?
The debt crisis was a major driver of higher gold prices last year, as investors bought the metal as insurance against a worsening outlook for the euro zone. However, its rally stalled in late 2011 as the metal appeared to lose its appeal as a safe haven.
UBS analysts said the market attitude toward gold has largely been cautiously optimistic after the metal fell 10 percent and briefly entered a bear market in the fourth quarter.
"A fresh catalyst was needed and we think the FOMC outcome on Wednesday fit the bill. More accommodative policy is a very good foundation for gold to build on the next move higher," the Swiss Bank said in a note.
Among other precious metals, silver was up 0.8 percent at $33.68 an ounce.
Gold Rises 1 Percent on Technical Buying, Euro Gains
Reuters
Gold rose 1 percent on Monday to a six-week high, boosted by technical buying and as the euro rallied ahead of the outcome of a euro zonemeeting on Greek debt restructuring.
Gold option volatility also spiked ahead of an expiration later this week. The metal broke above $1,669 an ounce, a key resistance level on technical charts, and approached the $1,700 an ounce level for the first time in a month.
A slumping dollar boosted bullion and crude oil, as Germany and Francepressed for a rapid deal between Greece and its private creditors to cut its soaring debt and avert default.
"Gold is reaching another technical area. An above $1,675 close tonight could mean additional buying this week ahead of option expiration and as traders await the euro zone news," said George Gero, vice president of RBC Capital Markets.
Spot gold was up 1.1 percent at $1,676.76 an ounce by 2:30 p.m. EST. Its session high of $1,681.16 was the highest price since December 12.
Gold has fallen only twice in the past 10 sessions and has risen 7 percent in January.
U.S. gold futures for February delivery settled up $14.30 an ounce at $1,678.30 in the COMEX division of NYMEX. Trading volume was in line with its 30-day average.
Volumes were light elsewhere as markets closed in China - one of the world's top gold consumers and in other key Asian markets for the Lunar New Year break.
On charts, gold rose above technical resistance at $1,669 an ounce based on a downward trendline connecting its all-time high and recent peaks, said Rick Bensignor, chief market strategist at Merlin Securities.
Bensignor said staying above that resistance should bring in short covering and new buyers who believe the correction is over.
Gold's next resistance lies at its 100-day moving average at $1,688 an ounce, analysts said.
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Gold Rises as IMF Calls for More Cash
WA Today
Gold rose on Wednesday on gains in the euro and US equities and optimism that the International Monetary Fund will raise additional funds to help combat Europe's debt crisis.
Bullion was on track for a third consecutive day of gains in decent trading volume after US investment bank Goldman Sachs Group Inc's earnings beat estimates and increased investor appetite for risk.
But traders were cautious after gold lost 10 per cent in December and a respected precious metals consultant warned the metal's decade-long bull run may be near an end.
"If the European situation doesn't get resolved, which has been priced into the market, we could be right back to asset-allocation type selling in a fairly short order," said Frank McGhee, head precious metals trader at Integrated Brokerage Services LLC.
McGhee said that gold could also sell off if China does not implement any kind of stimulus, as move that has been broadly anticipated by the markets.
Spot gold was up 0.6 per cent at $US1,660.50 an ounce by 12:50 p.m. EST (1750 GMT).
The metal rose on Tuesday after weak growth suggested that China may try to boost productivity through monetary easing.
US gold futures for February delivery gained $US5.50 an ounce to $US1,661.10.
COMEX gold options floor trader Jonathan Jossen said that the order flow was "very bullish," with good-size trades of call options at higher strike prices.
Gold fell earlier in the session. Traders cited a bearish industry report on Tuesday by metals consultancy GFMS that the metal is nearing the end of a decade-long run as the macroeconomic backdrop changes and investment in gold fades.
Silver rose 1.6 per cent to $US30.53 an ounce.
Silver prices fell sharply last year after hitting a record near $US50 an ounce in May, and underperformed gold in the full year as they fell 10 per cent against gold's 10 per cent rise. Silver's ratio to gold is currently at around 55, up from 32 in April.
Spot platinum edged up 0.1 per cent to $US1,521.99 an ounce, while spot palladium was up 2.7 per cent at $US666.22 an ounce.
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Gold Rises as ECB Comments Lift Euro
Yahoo News
Gold climbed towards $1,660 an ounce on Thursday after European Central Bank president Mario Draghi said the supply of cheap money released by the bank was helping stabilise the banking system and lift the euro zone economy, boosting the euro.
Spot gold was up 1 percent at $1,658.19 an ounce at 1444 GMT, having earlier touched a one-month high at $1,659.66. U.S. gold futures for February delivery were up $19.70 an ounce at $1,659.20.
Draghi said after the bank opted to hold interest rates steady that the ECB's flood of three-year money is helping the euro zone banking system substantially and supporting confidence in economic growth.
The bank's bond-buying process has only just begun to achieve its aim, he said. The euro rose to session highs after his comments, boosting gold, which tends to rise as the dollar weakens.
"There has been a fairly pronounced pullback (in the dollar) following weaker U.S. macro numbers and Draghi's comments," said VTB Capital analyst Andrey Kryuchenkov. He said a breach of $1,660 on gold could see prices swiftly return to $1,680.
Although it is currently rising, concerns that the euro zone economy remains mired in its debt crisis while the U.S. economy is improving has pressured the euro this year and consequently lifted euro-priced gold.
The euro is down 1.2 percent versus the dollar in January. Gold in euro terms has outperformed the spot metal this year, rising 7.4 percent against dollar gold's 6.0 percent.
The euro earlier rose against the dollar after an encouraging Spanish bond auction, which saw nearly 10 billion euros' worth of bonds sold against a target of 4-5 billion.
INDIA GEARS UP FOR WEDDING SEASON
Demand for physical metal in number one gold consumer India rose ahead of its wedding season as the rupee strengthened, dealers in Mumbai said.
"Demand has been good since last week, as prices are down due to a stronger rupee," said Harshad Ajmera, proprietor of JJ Gold House in Kolkata. "Jewellers are comfortable at this rate."
Chinese demand ahead of the Lunar New Year there this month has largely run its course, dealers said. Meanwhile, Chinese supply rose 2.7 percent in November to 32.6 tonnes, the Ministry of Industry and Information Technology said on Thursday.
China is the world's biggest producer of mined gold.
Among other precious metals, silver was up 1.7 percent at $30.45 an ounce.
Demand for silver coins has been strong at the start of the year, with the U.S. Mint reporting American Eagle silver coin sales of 4.257 million ounces in January so far, already a higher volume than recorded in any of the previous three months.
U.S. Mint gold coin sales have also been healthy at 82,500 ounces so far this month, already 26 percent higher than in the entire month of December.
Spot platinum was up 0.4 percent at $1,494.99 an ounce, while spot palladium was flat at $640.22 an ounce.
Platinum climbed for a fourth day on Thursday, on track for its largest weekly gain since October with a rise of 7 percent. Platinum's outperformance of gold pulled the gold/platinum ratio -- the number of platinum ounces needed to buy an ounce of gold -- down to 1.10 from a high of 1.15 earlier this week.
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Gold Rises, Breaks Ranks with Euro Again
Reuters
Gold rose on Thursday, a day after it broke ranks with riskier assets, on track to extend to a fifth straight day of gains in the face of a sharp fall in the euro on renewed European debt fears.
The metal reversed initial losses that were pressured by a report showing growth in the U.S. services sector only picked up slightly in December.
On Wednesday, gold hit a two-week high and appeared to buck a trend of moving in lockstep with the euro and the S&P 500 U.S. stock index. Gold has now recovered from last week's losses that briefly sent it into a bear market.
"I expect we are going to see money from hedge funds and money managers to return to gold as a safe haven by the end of the month," said George Nickas precious metals broker at commodities firm FCStone.
"It's just a matter of time for the gold buyers to return to the market as the European crisis hasn't been resolved," he said.
Spot gold gained 0.2 percent to $1,613.44 an ounce by 12:11 p.m. EST (1711 GMT).
U.S. February gold futures rose $2.30 to $1,615 an ounce.
Trading volume was strong for a third straight day, preliminary Reuters data showed. Analysts said stronger volume signaled renewed buying interest after gold fell sharply in thin holiday volume.
Earlier in the session, gold was under pressure as the euro slipped to its lowest since September 2010 against the U.S dollar as lingering concerns about euro zone debt crisis prompted weakness in the shared currency.
The 25-day correlation-log between spot gold and euro was near a one-year high reached last week, indicating strong positive link between bullion and the common unit.
"It is a risk on/risk off trade for gold. I expect gold to experience a volatile period throughout the first quarter, and this relates to the euro zone crisis," said Peter Fertig, consultant at Quantitative Commodity Research.
Silver edged up 0.1 percent to $29.18 an ounce, while platinum slipped 0.4 percent to $1,410.74 an ounce. Palladium dropped 1.4 percent to $637.22 an ounce.
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