Gold headed for the first weekly drop in three after European leaders agreed on a multibillion- euro rescue package for Greece, curbing contagion concerns, and a record rally prompted sales. Immediate-delivery bullion dropped for a second day, losing as much as 0.3 percent to $1,586.25 an ounce, before trading little changed at $1,590.53 at 10:02 a.m. in Singapore. Spot gold, which touched a record $1,610.10 on July 19 on debt concerns in Europe and the U.S., is 0.2 percent lower this week. Euro-area leaders announced 159 billion euro ($229 billion) in aid for Greece late yesterday after eight hours of talks in Brussels. They also tapped their 440-billion euro rescue fund to buy debt across stressed euro nations, aid troubled banks and offer credit-lines. “Scrap always comes back to the market in bulk when prices are high and this week we saw a lot of it, but demand is still strong and has been able to absorb the selling,” said Gordon Cheung, a trader at Standard Merchant Bank (Asia) Ltd. Gold for August delivery in New York rose for the first day in three, gaining as much as 0.4 percent to $1,592.50 an ounce. Holdings in exchange-traded products were little changed near a record at 2,121.241 metric tons yesterday, Bloomberg data show. Spot silver shed 0.3 percent to $39.30 an ounce. In the U.S., lawmakers remain divided over a $3.7 trillion deficit-cutting plan that may allow policy makers to agree on raising the $14.3 trillion debt ceiling before an Aug. 2 deadline. Standard & Poor’s yesterday reiterated there’s a 50 percent chance of a U.S. ratings cut within three months. Cash platinum was little changed at $1,782 an ounce, while palladium lost 0.4 percent to $804.75 an ounce. 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

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