MW: Gold trades near three-month low as Greek crisis boosts dollar
Gold traded near the lowest level since March as the crisis in Greece boosted the dollar, curbing the appeal of the metal. Silver rebounded from a seven-month low.
Bullion for immediate delivery was at $1,156.33 an ounce at 8:55 a.m. in Singapore from $1,155.26 a day earlier, when prices fell 1.3%, according to Bloomberg generic pricing. The metal sank as much as 1.9% on Tuesday to $1,148.13, the lowest since March 18.
Gold has slumped for the past four quarters in the longest run since 1997 as speculation the Federal Reserve will increase interest rates trumped concern that Greece will be forced out of the euro. Higher borrowing costs and a stronger greenback curb bullion’s appeal, which generally offers returns only through price gains. European leaders have set a Sunday deadline for Greece to accept a rescue.
“Gold remains aloof from any ‘safe-haven’ buying that may be inspired by the ongoing Greek situation,” James Steel, an analyst at HSBC Securities (USA) Inc., wrote in a note. “‘Flight-to-quality’ buying seems to have by-passed gold.”
The Bloomberg Dollar Spot Index traded near a five-week high on Wednesday. The gauge has jumped 19% in the past year on prospects for the first rate increase since 2006.
Gold for delivery in August rose 0.2% to $1,154.40 an ounce. Spot silver added 0.5% to $15.1467 an ounce after tumbling as much as 6.7% on Tuesday to $14.6898, the lowest level since December 1.
Platinum for immediate delivery lost 0.6% to $1,033.52 an ounce, extending a 2.3% drop a day earlier, to trade near a six-year low. Palladium fell 0.9% to $644.60 an ounce, declining for a fifth day in the longest streak since June 22.
