LONDON: Gold prices swung higher on Friday as the euro touched a seven-week high against the dollar, boosting the precious metal’s appeal as a hedge against weakness in the US currency.
Spot gold was quoted at $825.40/827.40 an ounce at 1530 GMT, up from $818.35 an ounce on Thursday and well off an earlier low of $807.00 an ounce.
US gold futures for February delivery were down 90 cents at $825.70 an ounce. A softer dollar tends to benefit gold, which is often bought as an alternative investment to the US currency.
Gold slipped in early trade along with other commodities such as oil and base metals after the failure of a mooted $14 billion plan to aid US carmakers.
Platinum fell four percent and palladium more than five percent as traders worried about the outlook for demand from carmakers, who consume about half of global supply of the two metals each year.
Troubles in the automotive sector have already knocked platinum and palladium down some 65 percent and 70 percent respectively from this year’s highs reached in March.
Spot platinum fell to a session low of $790.50 an ounce, and was later at $803/823 an ounce against $826. Palladium was at $171/174 an ounce against $177. Spot silver was at $10.22/10.30 an ounce, down from $10.30.
Copper falls nearly 9%: Copper prices lost almost nine percent on Friday as talks to bail out US auto makers collapsed, reviving investors’ fears about demand and the deepening global economic crisis. US lawmakers failed to agree a compromise late on Thursday, that would have thrown a $14 billion lifeline to embattled automakers.
Aluminium and other industrial metals followed copper’s lead as expectations were reinforced that demand growth could turn negative sooner than previously thought.
Copper for three month delivery on the London Metal Exchange was last bid at $3,020 in rings, from $3,320 at the close on Thursday and compared with a session low at $3,025.
Prices of the metal used in power and construction have fallen about 65 percent since a record high of $8,940 in July. Last week copper hit a 3-1/2 year low of $2,991 a tonne. Adding to the negative sentiment, LME stocks jumped 3,975 tonnes to 306,825 tonnes — its highest level since early 2004.
Aluminium fell 3.8 percent to a low of $1,505 and was last traded at $1,515 versus $1,565 on Thursday. LME inventories for the metal, used in transport and packaging, rose 15,725 tonnes to a 14-year high of 1.9 million tonnes.
Nickel slipped 7.4 percent to $10,280 a tonne from $11,105 at the close on Thursday but was last traded at $10,350.
Lead was at $986 from $1,020, zinc at $1,065 from $1,107, while tin was last bid at $11,450 versus $12,100. reuters
