BLBG:Gold Cuts Weekly Advance in London on a Stronger Dollar
Gold declined in London, cutting the first weekly gain in five, as a stronger dollar curbed demand for the metal as an alternative investment. Palladium reached a nine-month high.
The dollar rose for the first time in three days versus the euro as U.S. President Barack Obama is due to meet Democratic and Republican congressional leaders today as a year-end budget deadline approaches. Data showing drops in Japanese consumer prices and factory output fanned speculation the central bank will heed government calls to step up cash infusions.
“The euro is a bit weaker,” which might be pressuring gold, Afshin Nabavi, a senior vice president at bullion refiner MKS Finance SA in Geneva, said today by phone. “Everyone is looking at Washington for some direction, but nothing is happening on that front yet,” he said, referring to the impasse over U.S. spending cuts and tax increases.
Gold for immediate delivery lost 0.2 percent to $1,661.15 an ounce by 9:40 a.m. in London. Prices are up 0.2 percent this week, increasing this year’s gain to 6.2 percent. Gold for February delivery was 0.1 percent lower at $1,661.40 on the Comex in New York. Trading in Comex gold was about 25 percent lower than the 30-day average for this time of day, according to data compiled by Bloomberg.
Bullion is set for a 12th straight annual gain as central banks from the U.S. to China pledge more steps to spur economic growth. Holdings in gold-backed exchange-traded products rose 0.6 metric ton yesterday to 2,631.7 tons, less than 1 ton below the record set Dec. 20, data compiled by Bloomberg show.
Silver for immediate delivery fell 0.2 percent to $30.115 an ounce. Platinum was down 0.2 percent at $1,530.50 an ounce. Palladium slipped 0.1 percent to $707.75 an ounce, after reaching $711.80, the highest since March 5, earlier today.
To contact the reporters on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net; Glenys Sim in Singapore at gsim4@bloomberg.net
To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net
