BLBG:Gold Drops With Commodities On Europe Debt-Crisis Concern
Gold declined for the first time in three days, dropping with other commodities, on concern that a bailout of Spanish banks won’t stop the European debt crisis from spreading.
Greek voters head to the polls on June 17 to decide whether to honor the country’s bailout and potentially determine the currency bloc’s future shape. The euro fell as much as 0.3 percent against the dollar today following a three-day slide, helping fuel losses in oil and copper. U.S. Federal Reserve policy makers meet next week to review the recovery in the largest economy amid speculation they may add more stimulus.
“The metal remains vulnerable to further pressure short- term, particularly if further weakness is seen in risk markets or Greece’s second election fails to yield an elected government, adding yet more euro-region concerns,” James Moore, an analyst at TheBullionDesk.com, said today in a report.
Immediate-delivery gold lost 0.4 percent to $1,590.80 an ounce by 9:14 a.m. in London. August-delivery bullion declined 0.4 percent to $1,591.20 an ounce on the Comex in New York.
“Gold is biding time and consolidating near the $1,600 an ounce level,” said Mark O’Byrne, the executive director of Dublin-based GoldCore Ltd., a brokerage that sells and stores everything from quarter-ounce British Sovereigns to 400-ounce bars. “While the technicals are poor, the fundamentals remain sound with the euro-zone debt crisis far from resolved.”
The metal swung between gains and losses yesterday after Spain requested as much as 100 billion euros ($125 billion) of European funds, becoming the fourth euro member to seek a bailout since the crisis began almost three years ago in Greece.
Gold’s decline below $1,556.68, the June 8 low, may trigger a drop toward $1,526.97 and $1,522.65, Edel Tully, an analyst at UBS AG, said in a report today.
Spot silver fell 0.5 percent to $28.4125 an ounce. Platinum lost 0.8 percent to $1,432.75 an ounce and palladium dropped 0.9 percent to $616.75 an ounce.
To contact the reporter on this story: Maria Kolesnikova in London at mkolesnikova@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net
