Gold bounced back on Monday, on the back of a slide in the dollar and firm crude oil prices, but the precious metal lacked the drive to challenge the $800 yen level. Spot gold rose to $792.30/793.00 an ounce, from $784.80/$785.50 in late New York, but was down a touch from an intraday high of about 793.90.
It hit a 28-year high of $845.40 on November 7, just below its all-time high of $850 set in January 1980. "It's bounced back a bit, but there's really nothing new in the fundamentals to give it more drive," said Koji Suzuki, market analyst at Kazaka Commodity Co Ltd.
Suzuki, like some other analysts, said the gold market was still going through a correction after it rallied nearly $200 since mid-August. He said many investors were unlikely to bet heavily in either direction until Opec's policy meeting on December 5, when member countries are likely to discuss whether to pump more oil, a decision which would help dictate the dollar's value.
Opec did not provide a firm clue about its intentions at a state summit in Riyadh that ended on Sunday which also brought into focus a sharp political division over whether to take action over the weak dollar.
Nymex crude for January delivery, the new front month, rose 71 cents to $94.55 a barrel in Globex electronic trading, adding to on Friday's nearly 2 percent gains. The most active gold futures contract for October 2008 delivery on Tokyo Commodity Exchange closed the morning at 2,849 yen a gram, up 23 yen, or 0.8 percent, from Friday, after moving between 2,847-2,865 yen.
The dollar fell against the euro on Monday as concerns about the US housing sector and fears of credit-linked losses at financial institutions spreading to the broader economy prompted investors to shun the US currency. The euro climbed 0.1 percent to $1.4670 edging towards an all-time high of $1.4753 hit on electronic trading platform EBS last week.
The dollar was down 0.3 percent at 110.70 yen but stayed well above an 18-month low of 109.12 yen struck last week. In industry news, Anglo Platinum, the world's biggest platinum producer, cut this year's output forecast on Friday to between 2.45 and 2.5 million ounces of refined platinum, sending its share price tumbling.
The news helped lift platinum, used both for jewellery and as an auto catalyst to clean car exhaust fumes. Elsewhere, 27 gold miners were rescued unharmed in Australia after being trapped underground for five hours by a rockfall at the 140-year-old Ballarat gold mine, being redeveloped by new owner Lihir Gold Ltd.
Lihir is aiming to start commercial production at Ballarat in the second half of 2008. South Africa's Rand Refinery Ltd is looking to enter India's retail bullion market by launching its gold coins next year, a senior company official said on Sunday.
Cash platinum fell to $1,444/1,449 an ounce, from $1,446/1,451 late in New York. Spot silver climbed to $14.62/14.68 an ounce, from $14.44/14.49 in New York. Spot palladium fell to $362/366 an ounce, from $365/368 an ounce.
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