By Myra P. Saefong, MarketWatch
TOKYO (MarketWatch) — Gold futures climbed more than 1% on Globex during Monday afternoon trading in Asia, rebounding from last week’s loss as further weakness in the U.S. dollar lured investors back to the precious-metals sector.
Gold for December delivery (GCZ10 1,348, +22.60, +1.71%) climbed $17.80, or 1.3%, to trade at $1,342.90 an ounce in electronic trading on Globex after tapping a high of $1,343.20.
The contract had posted a decline of 3.4% last week, its first losing week in six, to close at $1,325.10, down 50 cents for Friday’s session. See Friday’s metals column.
Short-term dollar strength after supportive comments from U.S. Treasury Secretary Timothy Geithner had fueled the decline last week in gold prices. “This provided a ‘buy the dip’ opportunity,” Julian Phillips and Peter Spina wrote in a weekly report from GoldForecaster.com.
But on Monday, the U.S. dollar slipped after the Group of 20 finance ministers and central bankers meeting in South Korea failed to come up with any steps that investors believe would stem the greenback’s slide.
The dollar index (DXY 76.74, -0.73, -0.94%) , a measure of the U.S. unit against a basket of six major global currencies was recently at 76.951, down from 77.469 in late North American trading Friday. See currencies column.
Nothing has changed in the trend for gold in the long or short term, Phillips and Spina said.
“A glance at the fundamental problems in the global monetary system is not reassuring,” they said. “We cannot see a basis on which the exchange-rate problems can be resolved, for governments have an obligation to put national interest first, before international ones. This confirms that gold will remain in the uptrend.”
