Gold gained for the first time in three days in London as physical buying and concern about Europe’s debt boosted demand for the metal. European finance officials endorsed a bailout for Portugal as Luxembourg Prime Minister Jean-Claude Juncker said the region’s ministers floated the idea of extending Greece’s debt- repayment schedule. Billionaire investor George Soros sold 99 percent of his bullion-backed SPDR Gold Trust assets and all 5 million shares in the iShares Gold Trust, a filing showed. Hedge-fund manager John Paulson kept his SPDR Gold Trust stake. “There’s still a lot of uncertainty in the euro zone” and some physical buyers consider the price “relatively cheap,” said Bernard Sin, the head of currency and metal trading at MKS Finance SA, a bullion refiner in Geneva. “It’s a trading market and it’s no surprise that big investors liquidated positions. They may reinstate positions at a certain point and it doesn’t necessarily mean that others are going to follow.” Immediate-delivery gold rose $6, or 0.4 percent, to $1,495.30 an ounce by 11:45 a.m. in London. Gold for June delivery was 0.3 percent higher at $1,495 an ounce on the Comex in New York. Bullion fell to $1,495.50 an ounce in the morning “fixing” in London, used by some mining companies to sell output, from $1,500.75 at yesterday’s afternoon fixing. Accelerating inflation, Europe’s debt crisis, a weakening dollar and fighting in Libya boosted gold to a record $1,577.57 on May 2. Prices are up 5.2 percent in 2011 after climbing the past 10 years, the longest run of gains in at least nine decades. U.K. Inflation U.K. inflation accelerated more than economists forecast in April to the fastest since October 2008, data today showed. Bank of England Governor Mervyn King said inflation is likely to rise further in the next few months. Soros Fund Management LLC’s SPDR Gold Trust holding was worth $6.9 million as of March 31, the filing showed, compared with $655 million Dec. 31. He also cut stakes in NovaGold Resources Inc. (NG) and Kinross Gold Corp. (K) “Soros was sitting on a huge profit and like a lot of investors of late, he was happy to take those profits off the table,” said Gavin Wendt, founding director at MineLife Pty in Sydney. “That shouldn’t surprise people. Gold has been rising for a decade for fundamental reasons, which haven’t gone away.” Paulson & Co. maintained 31.5 million shares in the SPDR Gold Trust, a filing showed yesterday. Touradji Capital Management LP, founded by Paul Touradji, sold all of its 173,000 shares in the SPDR Gold Trust during the first quarter, the company said in a filing last week. Eric Mindich’s Eton Park Capital Management LP cut its stake in the exchange-traded product by 48 percent during the first quarter, a filing showed yesterday. Silver for immediate delivery rose 2 percent to $34.2675 an ounce in London after slumping 5.1 percent yesterday. Palladium gained 0.8 percent to $719.75 an ounce. Platinum climbed 0.9 percent to $1,773 an ounce. To contact the reporters on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net; Kyoungwha Kim in Singapore at kkim19@bloomberg.net To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

Source