Gold Rises on Dollar Drop; Platinum, Palladium Rebound

Gold futures rose as the dollar’s drop boosted demand for the metal as an alternative asset. Platinum and palladium rebounded from four-week lows after South Africa’s main utility declared a power emergency.

The Bloomberg U.S. Dollar Index dropped to the lowest in almost two weeks on speculation that Federal Reserve officials will reiterate that economic growth isn’t yet sufficient to trim stimulus. Janet Yellen, nominated to lead the central bank, has said the the labor market must improve before policy makers can consider tapering.

“The dollar is helping gold,” Dean Popplewell, a currency analyst at Toronto-based Oanda Corp., said in a telephone interview. “The timing of the tapering will continue to be the guiding force.”

Gold futures for delivery in December advanced 0.1 percent to settle at $1,273.50 an ounce at 1:42 p.m. on the Comex in New York. This year, the price has tumbled 24 percent, heading for the first annual drop since 2000.

Platinum futures for January delivery climbed 0.6 percent to $1,419.90 an ounce on the New York Mercantile Exchange. Earlier, the price touched $1,405.10, the lowest for a most-active contract since Oct. 17.

Palladium futures for December delivery rose 0.7 percent to $721.90 an ounce, after reaching $713.30, the lowest since Oct. 17. Trading more than tripled compared with the 100-day average for this time, according to data compiled by Bloomberg.

Eskom Holdings SOC Ltd., which generates almost all of South Africa’s electricity, said it will make “every effort” to avoid rolling blackouts after requiring key industrial customers to reduce usage by at least 10 percent.

In 2008, blackouts shut mines for five days. The nation accounts for 72 percent of platinum mine supply and 36 percent of palladium output, according to Barclays Plc.

Silver futures for December delivery fell 0.1 percent to $20.334 an ounce on the Comex. Earlier, the price touched $20.20, the lowest since Aug. 9.

To contact the reporters on this story: Debarati Roy in New York at droy5@bloomberg.net; Nicholas Larkin in London at nlarkin1@bloomberg.net

To contact the editor responsible for this story: Millie Munshi at mmunshi@bloomberg.net

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