RTRS: PRECIOUS-Gold steady near 1-month top on economic concerns
By Lewa Pardomuan
SINGAPORE, June 7 (Reuters) - Gold steadied on Tuesday,
after rising to its strongest in more than a month in the
previous session as fears about a slowing U.S. economy prompted
purchases from investors seeking an alternative investment.
Gold was steady at $1,543.09 an ounce by 0300 GMT
after rising as high as $1,553.30 on Monday, with investors
awaiting a speech by Federal Reserve Chairman Ben Bernanke on
the U.S. economic outlook later in the day.[ID:nN06262310]
Gold is still well below a lifetime high around $1,575
touched in early May, but with the U.S. dollar under pressure,
equities markets falling and the debt crisis in Europe far from
over, bullion -- with its safe-haven status -- continues to be
one of the chief beneficiaries.
"I think the odds are stacked in favour of gold at the
moment," said Darren Heathcote, head of trading at Investec
Australia in Sydney.
"I guess the other thing to watch is what happens if we're
getting more rhetoric from the various ministers and powers
within Europe about the Greece situation etcetera. I think the
market is still extremely weary of what the potential outcome
may be."
Greek Prime Minister George Papandreou told his cabinet on
Monday it was crucial to accept years of austerity to secure a
new international bailout, a challenge for a nation already
seething over corruption. [ID:nLDE7550KZ]
Silver , which normally tracks gold, hardly moved at
$36.58 an ounce, below a record at $49.51 an ounce hit in April.
Gold prices, which have gained for the last three straight
weeks, have been supported by the recent soft patch of data from
the United States.
Federal Reserve officials said recent economic data has been
disappointing, with one suggesting it could delay the Fed's exit
from its extremely easy monetary policy. [ID:nN06299146]
The Federal Reserve has kept interest rates near zero for
two-and-half years and this month completes a $600 billion round
of Treasury securities purchases designed to boost an economy
still recovering from its worst recession since the 1930s.
The euro inched up on Tuesday, steadying from a slide after
the Eurogroup chairman said the common currency was overvalued,
while Asian stocks eased as a trail of weak U.S. economic data
pointed to slowing growth.
The physical market lacked activity, with jewellers and
speculators on the sidelines following a rise in gold prices.
"It does look like there's a tough resistance at $1,553 an
ounce or above. There isn't much activity and consumers in
Thailand are also quiet," said a physical dealer in Singapore.
"I guess everyone is hoping to sell at higher levels, but
physical gold is not moving very much anywhere."
India's gold futures rose on Monday chasing gains in the
overseas markets, while demand in domestic spot market improved
despite price rise as jewellers, who were waiting for a
correction, made significant purchases.
Holdings of the largest silver-backed exchange-traded-fund
(ETF), New York's iShares Silver Trust and the largest
gold-backed ETF New York's SPDR Gold Trust remained
unchanged from Friday to Monday.
