Gold Climbs Most in a Week as Slowing Growth Spurs Demand
Gold gained the most in a week as concern that global economic growth is slowing increased demand for the metal as a protection of wealth.
A report today may show industrial production stagnated in the euro area after two months of declines, while data on July 13 may show that China’s economy grew at the slowest pace since 2009 in the second quarter, according to Bloomberg surveys. The The dollar slipped 0.3 percent against a basket of six currencies, before the Federal Reserve releases minutes of last month’s meeting, when it expanded a program of replacing short- term bonds with longer-term debt.
“A bit of dollar weakness overnight has helped gold,” said Saeed Amen, an analyst at Nomura International Plc in London. “We could also see some reaction after the FOMC minutes today as the market tries to assess how close we were to the QE3, especially given that the recent U.S. data has been on the weak side compared to expectations.”
Spot gold advanced 0.7 percent to $1,577.65 an ounce at 12:34 p.m. in London. A settlement at that price would mark the biggest gain since July 3. In New York, gold futures for August delivery slipped 0.3 percent to $1,577.30 on the Comex, after gaining 0.2 percent.
The euro gained as much as 0.4 percent against the dollar after dropping to a two-year low yesterday, sending bullion down by 1.3 percent.
“Issues surrounding Europe’s debt crisis and a slowing economy in the U.S. and China will offer support to prices,” said Sun Yonggang, a macroeconomic strategist at Everbright Futures Co., a unit of China’s largest state-owned investment group.
Holdings in the SPDR Gold Trust, the biggest exchange- traded product backed by bullion, fell to 1,271.24 metric tons as of yesterday, the least since May 31, the company’s website showed.
Spot silver rose 1.2 percent to $27.135 an ounce. Platinum for immediate delivery gained 0.3 percent to $1,428.75 an ounce. Palladium climbed 0.5 percent to $578.30 an ounce.
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