Gold Climbs to One-Week High as Draghi Sees Weakness
Gold jumped the most in more than two months after European Central Bank President Mario Draghi said economic weakness in the region will continue, boosting speculation that policy makers will do more to revive growth.
“The economic weakness in the euro area is expected to extend into 2013,” Draghi said at a press conference in Frankfurt today. The metal climbed 7 percent last year, a 12th straight gain, as central banks in Europe, the U.S. and China increased stimulus measures to boost economies.
“Draghi made it clear that Europe is still on the weaker side, and they will continue to lean towards accommodative policy,” Bill O’Neill, a partner at Logic Advisors in Upper Saddle River, New Jersey, said in a telephone interview.
Gold futures for February delivery gained 1.4 percent to settle at $1,678 an ounce at 1:47 p.m. on the Comex in New York, the biggest jump for a most-active contract since Nov. 6. Earlier, prices touched $1,678.80, the highest since Jan. 3.
“A gradual recovery should start” later this year as ECB measures work their way through the economy, Draghi said.
The metal also rose after better-than-expected China trade figures spurred optimism that demand for raw materials will increase. Data this week showed China’s net imports of gold rose to a seven-month high in November, while volumes traded on the Shanghai Gold Exchange jumped.
“The market was already trading higher on the Chinese data, and Draghi’s statements gave it a further boost,” O’Neill said.
Silver futures for March delivery advanced 2.2 percent to $30.918 an ounce in New York, the third gain in four days.
On the New York Mercantile Exchange, platinum futures for April delivery jumped 2.1 percent to $1,634.30 an ounce, the biggest climb since Sept. 12.
Palladium futures for March delivery gained 2 percent to $702.20 an ounce, the second straight rise.
To contact the reporter on this story: Debarati Roy in New York at email@example.com
To contact the editor responsible for this story: Steve Stroth at firstname.lastname@example.org