By Sarah Turner, MarketWatch
SYDNEY (MarketWatch) — Gold futures edged higher Tuesday after Greece’s institutional lenders reached a deal expected to trigger another aid payment for the debt-struck country.
Gold for December delivery GCZ2 +0.02% rose 50 cents to $1,750.10 an ounce on the Comex division of the New York Mercantile Exchange during East Asia trading hours.
Gold had slipped on Monday amid caution ahead of a meeting to discuss Greece’s finances, the third in as many weeks.
The meeting wrapped up early Tuesday with Greece’s institutional lenders reaching a deal to pave the way for Athens to receive almost 44 billion euros (almost $57 billion) of financial aid, while bringing its debt down to a sustainable level. Read: Euro zone, IMF agree on Greece debt deal
HSBC analysts said that gold’s path is likely to show sensitivity to moves for the euro against the U.S. dollar, and they had expected the euro to advance modestly if lenders agreed over financial-aid disbursement to Greece.
The euro EURUSD +0.17% rose to $1.2985 against the greenback on Tuesday after the announcement of the initial deal on Greek aid, rising modestly from $1.2961 ahead of the news.
Barring sharp currency moves or unexpected economic developments, the HSBC analysts expected this week’s contract expirations would exert the greatest near-term influence on gold.
“With much trading activity gravitating around the $1,750 an ounce level, we anticipate the expiration will be modestly price-positive for gold. Beyond that, we believe gold and silver prices will tend towards consolidation, as investors await further developments on the U.S. fiscal-cliff negotiations,” they said.
The fiscal cliff refers to more than $600 billion of automatic U.S. tax hikes and spending cuts due to occur in January unless circumvented beforehand.
December silver futures SIZ2 +0.05% advanced 6 cents to $34.20 an ounce Tuesday, while December copper futures HGZ2 +0.03% traded flat at $3.53 per pound.
Platinum for delivery in January PLF3 +0.34% rose $5.60 to $1,616.60 an ounce, and December palladium PAZ3 -2.04% advanced $4.70 to $665.90 an ounce.
Sarah Turner is MarketWatch's bureau chief in Sydney. Follow her on Twitter @SarahTurnerMKTW.
