BLBG:Gold Extends Monthly Gain in London as Physical Demand Improves
Gold extended a monthly gain in London as lower prices earlier this week spurred an increase in physical purchases. Palladium headed for the best monthly advance since 2010.
The dollar reached a five-week low against the euro as Democrats and Republicans wrangled over the spending cuts and tax increases of the so-called fiscal cliff looming for the U.S. in January. Holdings in gold-backed exchange-traded products reached a record as the U.S. Mint’s sales of American Eagle gold coins headed for the best month in almost two years. Gold slumped as much as 2.1 percent on Nov. 28.
“We’ve seen very good demand after the dip and it’s interesting to see physical demand suddenly pick up,” Bernard Sin, head of currency and metal trading at bullion refiner MKS Finance SA in Geneva, said today by phone. “The market is still worried about the fiscal cliff and how it will turn out. It’s the safe-haven logic” supporting gold, he said.
Gold for immediate delivery rose 0.2 percent to $1,729.69 an ounce by 9:31 a.m. in London. Prices are down 1.3 percent this week, cutting the monthly gain to 0.5 percent. Gold for February delivery was 0.1 percent higher at $1,731.30 on the Comex in New York.
After meeting U.S. Treasury Secretary Timothy F. Geithner yesterday, Republican House Speaker John Boehner said President Barack Obama must “get serious” about the fiscal cliff talks.
Holdings in gold ETPs climbed 3.5 metric tons to a record 2,619.4 tons yesterday, data compiled by Bloomberg show. The U.S. Mint sold 131,000 ounces of American Eagle gold coins this month, the most since January 2011, data on its website show.
Silver for immediate delivery was little changed at $34.2425 an ounce, after reaching $34.39 yesterday, the highest since Oct. 8. It’s up 6.1 percent this month. Platinum was 0.4 percent higher at $1,618.49 an ounce. Prices reached a five-week high of $1,624.13 yesterday and added 3.2 percent in November. Palladium rose 0.8 percent to $690 an ounce, after climbing to a 10-week high of $691 yesterday. It rallied 14 percent this month, the most since December 2010.
To contact the reporter on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter@bloomberg.net
