Gold hit a two-week high on Monday on safe-haven buying as crude oil rose above $59 a barrel, but a firmer US dollar trimmed gains and investors were keen to take profits at higher levels. Gold's gains, which were also driven by tensions on the Korean peninsula, sparked a rally in Japanese futures and elevated other precious metals.
Silver and palladium hit a two-week high while platinum gained as much as $9 an ounce. Spot gold hit a high of $592.50 an ounce and hovered at $590.00/591.00 an ounce, higher than $588.80/589.80 late in New York.
Resistance was pegged at resistance at $600 a level last seen in October. "That North Korean thing is probably having some sort of positive influence," said commodities analyst Tobin Gorey of Commonwealth Bank of Australia.
"But oil going back up again and the dollar going up again as well is a bit of a draw. It's sort of one is bad, one is good," said Gorey, adding that a firm dollar could limit gold's chance to regain $600 an ounce in the near term. Benchmark gold futures on the Tokyo Commodity Exchange rose by the daily 60-yen limit to 2,299 yen ($19.22) per gram on short covering.
The dollar was within sight of a 10-month peak against the yen after last week's upbeat US data on retail sales and consumer sentiment crushed expectations for the Federal Reserve to cut rates next year. The dollar edged up to 119.75 yen from around 119.65 yen in late New York. The euro eased to $1.2500 from $1.2513. "Let's see if we can break $600.
India did buy gold last week but I think they are on the sidelines now," said a dealer in Singapore, referring to the world's largest consumer. "There's no physical buying now. We can expect to see light selling later," he said. Gold gained nearly 2 percent on Friday after a break above $585 ignited technical buying while a rebound in oil prices encouraged investors to return to the market. Crude oil climbed to $59 a barrel after Opec called an emergency meeting later this week on output cuts.
Opec has struggled to stem a slide in price amid a disagreement over how to share up a 1 million barrel per day output cut that all members appear to agree is needed. On Thursday's face-to-face meeting now planned is expected to ease some lingering doubts.
On the geopolitical front, the United States insisted on Sunday that China had an obligation to help enforce new UN sanctions on North Korea for its claimed nuclear test. China joined in the Council's 15-0 approval of a US-drafted package of financial and weapons sanctions against North Korea, its old Communist ally and trading partner.
But Beijing made clear it would not conduct searches of cargo going to and from North Korea for material that could be used to produce weapons of mass destruction. Platinum rose to $1,080/1,085 an ounce from $1,073/1,078 late in New York. Palladium hit a two-week high of $316 an ounce, higher than $311/316 late in New York. Silver hit an intrude high of $11.63 before slipping to $11.55/11.62 an ounce, down from $11.59/11.66 late in New York.
Comments
Comments are closed.