BLBG:Gold Seen Gaining a 2nd Day as Dollar Drops Before Summit
Gold, little changed in London trading, may gain for a second day before European Union leaders hold a summit this week amid speculation that Spain will move toward seeking financial assistance.
Germany is open to Spain seeking a precautionary credit line from Europe’s rescue fund, two senior German coalition lawmakers said, prompting speculation that the Iberian nation may take the aid and help contain the euro-zone’s debt crisis. The euro rose to a one-month high against the U.S. dollar before trading up 0.5 percent.
“Gold and the precious complex have been held afloat overnight and this morning by a stronger euro,” Edel Tully, an analyst at UBS AG in London, wrote today in a report. “Gold’s ability to stay buoyed today will be dependent on foreign exchange moves and risk appetite.”
Gold for immediate delivery was 0.1 percent higher at $1,749.48 an ounce by 11:21 a.m. in London, after gaining as much as 0.4 percent earlier today. Bullion added 0.6 percent yesterday. The metal for December delivery climbed 0.3 percent to $1,750.80 an ounce on the Comex in New York.
Gold at the morning “fixing,” used by some mining companies to sell output, gained to $1,747.75 in London from $1,746.50 yesterday afternoon.
EU leaders are set to gather in Brussels for two days starting tomorrow. Gold, up 12 percent this year, is on course for a 12th annual gain as central banks from Europe to the U.S. boost stimulus to try to strengthen their economies.
“If Spain’s financial troubles can be kept in check, it helps stabilize market sentiment,” said Xiang Nan, an analyst at CITICS Futures Co., a unit of China’s biggest listed brokerage.
Holdings in exchange-traded products were little changed at 2,577.25 metric tons yesterday after climbing to a record 2,582.98 tons on Oct. 11, data compiled by Bloomberg show.
Silver for immediate delivery gained 0.2 percent to $33.01 an ounce. Platinum rose 0.5 percent to $1,651.25 an ounce. Palladium added 0.6 percent to $643.45 an ounce.
To contact the reporters on this story: Maria Kolesnikova in London at mkolesnikova@bloomberg.net; Glenys Sim in Singapore at gsim4@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net
