Gold slips in Europe

14 Jan, 2010

Gold slipped in Europe on Wednesday as the dollar recouped losses against the euro and inflation fears eased after oil prices fell. Spot gold was bid at $1,124.00 a troy ounce at 1549 GMT, against $1,127.95 late in New York on Tuesday. US gold futures for February delivery on the COMEX division of the New York Mercantile Exchange eased $5.1 to $1,124.30.
"The fall in gold is related to the dollar, which has reversed early losses," said David Thurtell, analyst at Citi. "Weakness in oil seems to be playing a part." Gold hit a record high of $1,226.10 a tonne on December 3. Analysts said lower gold prices in recent weeks meant more activity in the physical market. "This morning and last night, there were quite a few physical buyers bargain hunting around in the marketplace, and we saw some good demand out of India and elsewhere," said Afshin Nabavi, head of trading at MKS Finance.
Holdings of the world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, fell another 3.7 tonnes on Tuesday, bringing their decline so far this year to nearly 18 tonnes, or 1.6 percent. Silver was bid at $18.33 an ounce against $18.24. Among other precious metals, platinum was at $1,559.50 an ounce against $1,568.50, while palladium was at $417.50 against $421.50.
US platinum and palladium exchange-traded funds launched last Friday were met with buying interest, with about 170,000 ounces of metals added in the first two trading sessions, a spokesman for ETF Securities, which operates the funds, said. "Continued strong ETF investment in 2010 (potentially amplified by the US ETFs) would push the platinum and palladium markets into deficit," said RBS Global Banking & Markets in a research note.

Read Comments