BS: Gold Falls Most in Two Weeks as Euro Strength Cuts Haven Demand
July 16 (Bloomberg) -- Gold futures fell the most in two weeks as the euro’s strength against the dollar reduced demand for the precious metal as an alternative to holding currency.
The euro, up for the fourth straight day, topped $1.30 for the first time since May 10. Gold reached a record $1,266.50 an ounce on June 21 and rallied to all-time highs in euros, sterling and Swiss francs last month as investors sought a haven during Europe’s fiscal crisis.
“There’s continued unwinding of the gold-euro trade,” said Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago. “As the euro firms up, the risk premium comes off.”
Gold futures for August delivery fell $17.40, or 1.4 percent, to $1,190.90 at 8:52 a.m. on the Comex in New York. A close at that price would mark the biggest drop since July 1 and leave the metal down 1.6 percent for the week. Gold gained 10 percent this year before today.
--Editors: Daniel Enoch, Patrick McKiernan.
To contact the reporter on this story: Pham-Duy Nguyen in Seattle at pnguyen@bloomberg.net.
To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net
