Gold steadied Tuesday, hovering near its highest level in a week with any dip in the dollar likely to spur another round of buying from speculators.
Silver slipped but also held near a one-week high, palladium was within sight of its highest level in nearly two months and platinum firmed. Gold was at $883,10/884,10 an ounce, steady from $883,60/884,80 an ounce late in New York yesterday, when it jumped as high as $894,70 an ounce on a weaker US dollar, still well below a record high of $1030,80 hit in mid-March.
“For the short run until end of the week, if gold is able to get out of its trading range above $900, gold might retest $930 and $955,” said William Kwan, bullion director of Gold Capital Management in Singapore.
The dollar fell against the euro and the yen after a media report, that Federal Reserve officials believe financial markets have gone too far in their expectations for US interest rate increases. Oil slipped 2 cents to $134,59 a barrel, after a rally to a record $139,89. In the physical sector, high gold prices triggered light selling from investors and jewelers in Vietnam and Thailand, but Indonesia, which is Southeast Asia’s largest consumer, was on the sidelines. “I think some people are not sure whether they should buy now before the price rises again but definitely $900 is the target. I would say we have to watch oil and dollar,” said a dealer in Singapore.
Premiums for gold bars were steady at $70 an ounce to the spot London prices in Singapore Gold futures for August delivery on the COMEX division of the New York Mercantile Exchange fell $1,0 an ounce to $885,4.
Dealers awaited yesterday’s release of the May US Producer Price Index, said Ronald Leung, director of Lee Cheong Gold Dealers in Hong Kong. “I think we are waiting for fresh news. There’s PPI tonight and there maybe some sanctions to be imposed on Iran,” said Leung, adding that gold would trade in a range of $850 to $900 in coming days. Silver edged down to $17,15/17,22 an ounce from $17,16/17,22 late in New York yesterday, when it jumped to a one-week high of $17,40 due to a weaker dollar and gains in gold.
Spot platinum rose to $2,050,00/2,060,00 an ounce from $2,038,50/2,058,50 late in New York. Spot palladium edged down to $455,00/463,00 an ounce from $456,50/464,50. It hit a high of $460 an ounce Monday, its strongest level since April 18, catching up with gains in other precious metals. The most active Tokyo platinum contract for April 2009 delivery on the Tokyo Commodity Exchange rose ¥63 per gram to ¥6.968. (Reuters)