May 28 (Bloomberg) -- Gold may gain for the fourth time this week in New York on speculation the debt crisis in Europe will boost demand for the precious metal as a haven.
Gold rallied 3.4 percent this week and is heading for a 3 percent gain this month, while assets in the world’s largest gold-backed exchange-traded fund increased to a record. U.S. Treasury Secretary Timothy F. Geithner said yesterday the U.S. and Europe are in “broad agreement” on the need for tighter regulation to help calm volatile markets.
“The safe haven concept is still there,” said Afshin Nabavi, a senior vice president at bullion refiner MKS Finance SA in Geneva. “A lot of people are still investing in physical gold. But we need a bit of stability in prices to attract more people” to the precious metal, he said.
Gold futures for August delivery gained $1.20, or 0.1 percent, to $1,215.60 an ounce by 8:10 a.m. on the Comex in New York. Bullion for immediate delivery in London was 0.1 percent higher at $1,214.10.
The metal rose to $1,214 an ounce in the morning “fixing” in London, used by some mining companies to sell output, from $1,211 at yesterday’s afternoon fixing. Spot prices are up 11 percent this year.
Gold futures climbed to a record $1,249.70 on May 14 as investors sought to protect their wealth amid Europe’s sovereign-debt crisis. The euro is headed for a sixth monthly drop against the dollar amid concern the region’s financial turbulence will slow growth.
“Gold is at the moment fulfilling its traditional role as a safe haven,” Citigroup Inc. commodity analyst Alan Heap said on Bloomberg television. “Investors are once again concerned about sovereign risk” and a rally to $1,500 an ounce is possible this year, he said.
The gold market is very important to China and a “good choice” to help implement its plan to internationalize the yuan, said Wang Zhenying, deputy director-general of the Department of Financial Market Management at the People’s Bank of China Shanghai office. The country should improve and develop more gold investment products, Zhenying said.
Holdings in the SPDR Gold Trust, the biggest ETF backed by bullion, increased by 0.3 metric ton to a record 1,267.93 tons yesterday, according to the company’s website. Global holdings rose 0.6 ton to 1,981.8 tons yesterday, according to Bloomberg data tracking 10 providers.
Twenty-two of 26 traders, investors and analysts surveyed by Bloomberg said bullion would rise next week. Two forecast lower prices and two were neutral.
Platinum for July delivery in New York gained 0.5 percent to $1,561 an ounce. Palladium for September delivery added 0.3 percent to $466.40 an ounce. Silver for July delivery rose 0.4 percent to $18.55 an ounce.
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