BLBG: Gold Advances as First Monthly Drop Since March Spurs Investors' Demand
Gold advanced on speculation that a drop in prices in July, the first monthly loss since March, is spurring some physical demand.
Gold for immediate delivery rose 0.2 percent to $1,185.97 an ounce at 2:02 p.m. in Singapore. The metal touched a record $1,265.30 an ounce on June 21 and has weakened 4.6 percent in July. August-delivery futures in New York were also little changed at $1,187.90 an ounce.
“The regional physical markets are still seeing bargain hunting, which is helping to underpin values,” David Wilson, an analyst at Societe Generale in London, wrote in a report yesterday. “The continued uncertainties in the markets are expected to sustain investment interest and we look for further price gains.”
The price may reach $2,000 an ounce in the coming years because of supply constraints and investment demand, Owen Hegarty, vice chairman of G-Resources Group Ltd., said in an interview.
Bullion has strengthened 8 percent this year, on course for a 10th straight annual advance, the longest winning streak since at least 1920, as investors sought to protect their wealth against European financial turmoil.
Demand waned this month as concerns that the European sovereign debt crisis will worsen eased after most banks in the region passed stress tests designed to show their ability to withstand financial turmoil.
Silver was little changed at $18.19 an ounce, platinum gained 0.7 percent to $1,558.53 an ounce and palladium increased 0.8 percent to $475.67 an ounce at 2:01 p.m. in Singapore.
To contact the reporter on this story: Kyoungwha Kim in Singapore at Kkim19@bloomberg.net
