Gold may gain after European governments failed to agree on a Greek rescue package and signs the U.S. economy may be slowing boosted demand for the precious metal as a haven asset. Immediate-delivery gold fell 0.2 percent to $1,537.20 an ounce at 12:55 p.m. in Singapore after gaining 0.6 percent on June 17. The August-delivery contract in New York was little changed at $1,537.80 an ounce. “The market’s waiting with bated breath to see what comes out of the European discussions on Greece,” Darren Heathcote, head of trading at Investec Bank (Australia) Ltd., said by phone. “The euro gets hit if we get bad news and recovers if we get good news and gold tends to go with it.” European governments failed to agree on releasing a loan payout to spare Greece from default, pushing the country to pass laws to cut the deficit and sell state assets. Decisions on the next payout and a three-year follow-up package were put off until early July. “We forcefully reminded the Greek government that by the end of this month they have to see to it that we are all convinced that all the commitments they made are fulfilled,” Luxembourg Prime Minister Jean-Claude Juncker told reporters early today after chairing a euro-crisis meeting in Luxembourg. Greece needs to secure parliamentary approval of 78 billion euro ($111 billion) in budget cuts to ensure the payment of a fifth loan under last year’s 110 billion-euro bailout. Prime Minister George Papandreou began a three-day debate yesterday on a confidence motion in his new government. He called for the vote last week, after opposition parties rejected pleas for national consensus and his handling of the crisis led to defections from his party. ‘Uncertainty Supports’ “Uncertainty is keeping gold well supported at the moment,” Heathcote said. Mixed U.S. economic data would help maintain gold as a safe-haven investment, he said. Reports showed business activity in the U.S. cooled more than forecast, sales of existing homes unexpectedly dropped and growth in industrial production stopped. Gold futures have gained 25 percent in the past year, extending a decade-long advance, as the prospect of currency debasement and accelerating inflation fuel investor demand. Fighting in Libya and sovereign-debt turmoil in Europe have also contributed to the rally. Silver for July delivery fell 0.5 percent to $35.575 an ounce after gaining as much as 1.3 percent to $36.20. The metal for immediate delivery dropped 0.9 $35.565 an ounce. Palladium lost 0.2 percent to $744.75 an ounce and platinum was little changed at $1,756.75 an ounce. To contact the reporter for this story: Phoebe Sedgman in Wellington at psedgman2@bloomberg.net To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

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