BLBG:Gold May Advance Before European Summit As Investors Seek Haven
Gold may rally, paring the biggest quarterly loss since Lehman Brothers Holdings Inc. collapsed, as concern Europe’s debt crisis is worsening raises haven demand.
Spot gold was little changed at $1,573.02 an ounce at 12:29 p.m. in Singapore after falling 0.7 percent yesterday. The metal has lost 5.7 percent since March 30, the worst performance since the three months to September 2008, as investors picked the dollar over bullion to protect their wealth. The dollar is up 4.2 percent this quarter against a six-currency basket.
German Chancellor Angela Merkel and French President Francois Hollande meet today ahead of a two-day summit of leaders tomorrow. The euro was lower against the dollar after Italian and Spanish bond yields jumped at debt sales yesterday.
“Everybody has got their eyes on Europe, they’re waiting to see whether Europe has a banking collapse or meltdown,” said Byron Wien, chairman of the advisory services unit of Blackstone Group LP, the world’s biggest private-equity firm. “If you have a long-term view, you’re going to make money in gold. You should own it as an insurance policy, not as a commodity play.”
Cash gold is the best-performing precious metal this quarter, outperforming silver, platinum and palladium, which are used mainly in industrial applications. Bullion also beat the Standard & Poor’s GSCI Index of commodities, which has lost 17 percent in the quarter as global growth concerns escalated.
August-delivery gold was little changed at $1,573 an ounce on the Comex in New York.
‘Still Bullish’
“I’m still bullish on gold,” Wien said in a Bloomberg Radio interview. “Central banks around the world are printing money, they’re debasing their currencies. It’s a race to see who’s going to debase more. Gold is something real.”
Spot silver was little changed at $27.1125 an ounce, after swinging between gains and losses. The metal is 16 percent lower since the end of March, set for the worst quarterly loss since the three months to September 2008.
Cash platinum declined 0.2 percent to $1,425, down 13 percent this quarter and also poised for the worst quarter since the period to September 2008. Palladium fell for a third day, dropping 0.4 percent to $595 an ounce, set for a second quarterly loss.
To contact the reporter on this story: Glenys Sim in Singapore at gsim4@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
