Gold slips but near 1-month high
Gold edged down as investors booked profits after pushing up the price to its highest level in a month last week, but record oil and a weaker US dollar may spur another round of buying.
Gold eased to $925.25/926.55 an ounce from $927.20/928.20 an ounce late in New York on Friday, when it rose as high as $930.40 an ounce as record high oil and weak stock markets triggered buying from investors.
“The dollar doesn't seem to have any luck at all and oil price is at higher end. Things seem to be in favor of gold for the time being,” said Ronald Leung, director of Lee Cheong Gold Dealers in Hong Kong.
“Of course we have to see profit taking. $920 will be the support and resistance will be at $930-$935,” he said.
In fundamental news, Japan's first bullion-backed exchange-traded fund started trading on the Tokyo Stock Exchange on Monday in a bid to draw more investors and enhance Tokyo as a financial centre.
Oil rose $1.38 a barrel to $141.57, hovering near last week's record high near $143, on weak US dollar and tensions between Israel and Iran over Tehran's nuclear program. Rising energy costs boost gold's role as a hedge against inflation, while a weaker dollar elevates the metal's appeal as an alternative investment.
The dollar hit a three-week low against the euro on the back of record high oil, fears about US growth and as Wall Street stocks extended their slide.
“I guess we are seeing light physical profit taking and the Japanese are on the selling side but the market is still in a good shape,” said a dealer in Hong Kong.
“I don't expect selling to last long and in fact, I've seen a little bit of buying interest at lower levels. I guess all depends on movements in oil and the euro.”
Gold futures for August delivery on the COMEX division of the New York Mercantile Exchange fell $3.4 an ounce to $927.9.
Spot platinum rose to $2,055.50/2,075.00 an ounce from $2,053.50/2,073.50 late in New York.
Spot palladium rose to $464.00/472.00 an ounce from $463.00/471.00 an ounce, having earlier hit a low of $446.50 an ounce. Speculators booked profits after the price jumped to a three-month high of $477 on June 19.
Silver rose to $17.55/17.60 an ounce from $17.52/17.61 late in New York. (Reuters)
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