ET:Gold gains as physical demand improves after price decline
LONDON: Gold today rebounded as the biggest weekly drop in more than five months boosted physical purchases and a weaker dollar increased demand for an alternative investment.
Gold rose 0.3 per cent to $1,719.44 an ounce, after losing 2.2 per cent last week, the most since June 22. Silver also gained 0.6 per cent to $33.59 an ounce.
The dollar reached an almost six-week low versus the euro on concern US lawmakers won't be able to avoid the so-called fiscal cliff.
Local market reports indicated a pick-up in physical gold demand in India, last year's biggest buyer, and in China, after prices dropped. US Mint sales of gold coins to over double in November, its highest since July, 2010.
US Treasury Secretary Timothy F Geithner and House Speaker John Boehner hardened their positions over the fiscal cliff, each blaming the other for a standoff that may lead to more than $600 billion in tax increases and spending cuts in January.
Holdings in gold-backed exchange-traded products climbed 2.3 tonnes to a record 2,621.7 tonnes.
