BS: Gold Rises to Two-Week High as Improving Economy Spurs Demand
By Nicholas Larkin and Glenys Sim
April 1 (Bloomberg) -- Gold rose to its highest in almost two weeks in New York as an improving economy spurred demand for the metal. Platinum and palladium climbed to the highest prices since 2008.
European and Asian equities gained as reports showed Chinese manufacturing accelerated and confidence among Japan’s industrial companies improved. Gold futures rose 1.7 percent in the three months ended yesterday, a sixth quarterly increase.
“Equities are up and that indicates investors are buying more risky assets” including gold, said Peter Fertig, the owner of Quantitative Commodity Research Ltd. in Hainburg, Germany.
Gold futures for June delivery added as much as $11.20, or 1 percent, to $1,125.70 an ounce on the Comex in New York, the highest price since March 19. The metal traded at $1,125.10 at 8:53 a.m. local time. Gold for immediate delivery in London was 0.9 percent higher at $1,123.48.
Bullion was little changed at $1,116 an ounce in the morning “fixing” in London, used by some mining companies to sell production, from $1,115.50 at yesterday’s afternoon fixing.
Initial U.S. jobless applications declined by 6,000 to 439,000 in the week ended March 27, Labor Department data showed today. Another report today may show U.S. manufacturing grew.
The World Gold Council and Industrial & Commercial Bank of China Ltd. plan to develop new gold investment products, the producer-funded group said today. One investment program may involve the bank, which has more than 200 million clients, buying gold on behalf of customers in daily increments to smooth out price swings, the Wall Street Journal reported.
Quarterly Increases
Gold futures posted quarterly increases between 0.3 percent and 8.8 percent since the end of 2008, marking the longest rally since 1979. The metal is trading 9 percent below a record $1,227.50 set on Dec. 3.
“The higher quarterly close is important technically and shows momentum and the medium- and long-term trend remains upward,” said Mark O’Byrne, executive director of broker GoldCore Ltd. in Dublin. “The slow, steady and gradual rise of gold in recent quarters also contradicts the commonly held view that gold is a speculative bubble.”
Holdings in the SPDR Gold Trust, the largest exchange- traded fund backed by bullion, were unchanged for a second day at 1,129.8 tons yesterday, according to the company’s Web site.
Silver for May delivery in New York gained as much as 1.4 percent to $17.77 an ounce, the highest price since Jan. 21, and was last at $17.765. Platinum for July delivery climbed as much as 1.3 percent to a 20-month high of $1,667.90, and last traded at $1,662.80. Palladium for June delivery advanced to a two-year high of $493.50 an ounce and was last up 1.7 percent at $488.25.
--Editors: John Deane, Stuart Wallace.
To contact the reporter on this story: Nicholas Larkin at nlarkin1@bloomberg.net; Glenys Sim in Singapore at gsim4@bloomberg.net.
To contact the editors responsible for this story: James Poole at jpoole4@bloomberg.net; Stuart Wallace in London at swallace6@bloomberg.net.
