US gold futures opened at their highest level in eight months on Friday before backing down a bit, as dollar weakness and record crude prices attracted investors to alternatives like the precious metals.
A 6.1 percent rise in the US trade deficit in June after COMEX gold opened prompted a flash of buying in gold as the dollar briefly eased, but a lack of follow-through and some long liquidation then pushed the metal futures lower.
Prices were gyrating as currency values fluctuated wildly over the last day and the trade data and $66 crude oil largely have been fuelling the heavy turnover in the yellow metal.
"This is just profit-taking and a lack of bids," a desk trader at an international bank in New York said. "We went up really quickly and a little correction is necessary."
By 9:42 am EDT, gold for December delivery on the New York Mercantile Exchange was up $1.40 at $452.30 an ounce, patrolling a range of $449.10 to $455.30.
The day's high, hit during overnight NYMEX ACCESS electronic trading, was the priciest for futures on a spot continuation basis since December 2004, when the active contract neared $460.
After spot gold scaled an eight-month peak at $449.30 an ounce earlier, it edged to $443.60/444.40, compared with Thursday's New York late quote at $445.30/446.10. Friday's early fix in London was at $447.25.
In silver, COMEX September futures tumbled 7.3 cents to $7.11 an ounce, pressured by profit taking in gold. The range ran from a one-week high at $7.255 to 7.065. Spot silver dipped to $7.08/11, from $7.15/18 Thursday.
In the NYMEX metals, October platinum shed $2.70 to hold at $917 an ounce. Spot platinum brought $913/918 an ounce, off from a 15-month high at $923.
September palladium was unchanged at $188.50 an ounce. Spot was worth $186/190.