Gold Gains Most in a Week as Commodities Rise Amid U.S. Optimism
Gold futures rose the most in a week, tracking gains in commodities, as prospects improved for a U.S. budget deal and unrest in the Middle East spurred demand for the metal as an alternative investment.
The Standard & Poor’s GSCI Spot Index of 24 commodities rose to a four-week high, and the MSCI All-Country World Index of equities advanced for the first time since Nov. 6 amid optimism that U.S. lawmakers will reach an accord to avert automatic spending cuts and tax increases scheduled to start 2013. Israel said its army was ready to invade the Gaza Strip.
“People are in a ‘risk-on’ mode as they expect Washington to come up with a solution” on the so-called fiscal cliff, Adam Klopfenstein, a senior market strategist at Archer Financial Services Inc. in Chicago, said in a telephone interview. “The situation in the Middle East is also putting some bid under gold.”
Gold futures for December delivery rose 1.1 percent to settle at $1,734.40 an ounce at 1:56 p.m. on the Comex in New York, the biggest gain for a most-active contract since Nov. 6. The price has advanced 11 percent this year.
Holdings in gold-backed exchange-traded products rose 4 metric tons to a record 2,603.7 tons on Nov. 16, data compiled by Bloomberg show. Assets and prices gained this year as central banks from the U.S. to Asia took steps to bolster economies.
Silver futures for December delivery climbed 2.5 percent to $33.189 an ounce on the Comex, the biggest jump since Nov. 6.
On the New York Mercantile Exchange, platinum futures for January delivery rose 1.4 percent to $1,583.80 an ounce, the biggest increase since Oct. 31.
Palladium futures for December delivery surged 3 percent to $645.30 an ounce, the highest settlement in a month.
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