MW: Gold wavers as U.S. dollar retains ground against euro
By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) -- Gold futures edged lower on Wednesday in the wake of the prior session's solid rise, as a strengthening U.S. dollar curbed interest in the metal and other commodities.
Up and down in early Wednesday trade, gold for June delivery was lately off 30 cents to $1,161.9 an ounce on the Comex division of the New York Mercantile Exchange.
On Tuesday, the June contract rose $8.20, or 0.7%, to end at $1,162.20 an ounce after the downgrade of credit ratings for both Greece and Portugal hammered the U.S. equities market and some dollar-denominated commodities include crude oil. But bullion gained as investors fled to assets perceived as relatively safe.
On Wednesday, the euro rebounded slightly versus the U.S. dollar, but remained not far off of a one-year low amid fears Greece's debt crisis could spiral out of control, infecting other indebted euro-zone countries.
The euro tumbled to a one-year low Tuesday after Standard & Poor's cut Greece's credit rating to junk status and lowered Portugal's rating two notches. Read about the downgrades.
The euro (CUR_EURUSD 1.3249, +0.0080, +0.6077%) edged up to $1.3198 from $1.3179 in North American trade late Tuesday, but still traded lower than the $1.3357 level seen ahead of the downgrades.
Holdings on the SPDR Gold Trust (GLD 113.89, -0.74, -0.65%) on Tuesday hit a fresh record high of 1,146.825 tons, according to the fund, the world's biggest backed by gold and will "reinforce expectations of a spot move back into record highs of $1226.10 recorded last December," said analysts at Action Economics.
