Gold Extends Decline As Dollar Strength Counters Stimulus Bets
Gold fell for a second day, reversing an earlier advance, as the euro weakened against the dollar before finance ministers and central bank governors from the Group of Seven nations hold a call on Europe’s debt crisis.
The dollar rebounded against a six-currency basket including the euro, gaining for the first time in three days. The G-7 telephone discussions today precede a summit of leaders from the Group of 20 in Los Cabos, Mexico, June 18-19. Gold lost 1.4 percent in the past month as theDollar Index rallied 3.9 percent in the same period.
“Gold has been trying to re-assert itself as a safe haven; however the dollar’s strength will continue to act as a resistance to rising prices,” said Feng Liang, an analyst at GF Futures Co., a unit of China’s second-largest listed brokerage.
August-delivery bullion was little changed at $1,615.70 an ounce on the Comex in New York, after rising as much as 0.7 percent. Holdings in the SPDR Gold Trust, the biggest exchange- traded product backed by bullion, stood unchanged at 1,273.88 metric tons yesterday, after climbing on June 1 for the first time since May 24, the company’s website showed.
Spot silver fell for a second day, dropping as much as 0.3 percent to $28.1750 an ounce and reversing a 0.8 percent advance. It was last at $28.2325. Cash platinum climbed 0.5 percent to $1,436.50 an ounce, paring a 1.5 percent gain. Palladium was unchanged at $612 an ounce, after adding 1 percent earlier.
June 5, 2012 (Source: Bloomberg)