(RTTNews) - Gold rebounded modestly as traders took advantage of the lowest prices in more than 13 months. December gold closed at $730.30 an ounce, up $15.60 on the session. The metal closed higher for just the second time in 12 sessions.
Earlier, gold hit as low as $681, its lowest intraday mark since September 2007. Even with the recovery, gold has lost more than $175 from its highest crossing of October. On a long-term basis, the precious metal has lost about 30% from its record $1,033.90 on March 17.
The greenback hit a two-year high below 1.2494 against the euro before surrendering some of its daily gains. The dollar slipped to a six-year low of 1.5257 against the sterling.
On the economic front, a National Association of Realtors report showed that existing home sales rose 5.5 percent to an annual rate of 5.18 million units in September from an unrevised August rate of 4.91 million units. Economists had expected existing home sales to edge up to a 4.95 million unit rate.
Crude oil prices continued to fall on Friday and reached a fresh 16-month low as traders showed they felt a cut in production by the Organization of Petroleum Exporting Countries will not be enough to combat declining demand. Light sweet crude fell $3.02 to $64.82 a barrel. Prices hit as low as $62.65 in early trading
In an effort to tackle the drop in the demand for oil in the face of the slowing global economy, OPEC announced it will reduce oil production by 1.5 million barrels/day, effective November 1. Many experts were expecting a drop of about 2 million barrels/day.
The extraordinary meeting of OPEC held at Vienna, Austria, decided to cut production from the current OPEC-11 production ceiling of 28.808 mb/day. The meeting was originally planned for Nov. 18 but moved up as prices tumbled more than 50% from the record highs. The next ordinary meeting is scheduled to be held in Oran, Algeria, on December 17, but some experts are speculating another cut in production could be seen before that.
