Gold Advances in New York as Weaker Dollar Spurs DemandDebarati Roy and Nicholas Larkin
Gold futures climbed for the second time in three sessions on signs of increased physical purchases.
Bullion futures have jumped 8.7 percent this month, set for the biggest monthly increase since January 2012. This month’s gain was driven by investors closing out bets on price drops and “opportunistic” buying from Asia, after the metal fell into a bear market in April, according to VTB Capital. Federal Reserve policy makers begin a two-day meeting tomorrow.
“There is some physical demand from the Far East” Peter Hug, the global trading director of Kitco Metals Inc., said in a report. “Traders and investors are looking ahead to the U.S. Federal Open Market Committee meeting that ends Wednesday for more guidance.”
Gold futures for December delivery rose 0.6 percent to settle at 1,329.60 an ounce at 1:44 p.m. on the Comex in New York. The precious metal gained 2.2 percent last week.
Fed Chairman Ben S. Bernanke said this month that it’s too early to decide whether to begin scaling back debt purchases in September, after saying on June 19 that bond buying could slow if the economy improves. The U.S. central bank purchases $85 billion of Treasuries and mortgage debt each month.
Gold has tumbled 21 percent this year after some investors lost faith in the metal as a store of value and on speculation that the Fed may curb its bond-buying program that helped bullion to a 12-year bull run through 2012.
Holdings in exchange-traded products backed by the metal fell to 1,969.9 metric tons on July 26, the lowest since May 2010, data compiled by Bloomberg show.
Silver futures for September delivery climbed 0.5 percent to $19.864 an ounce in New York.
On the New York Mercantile Exchange, platinum futures for October delivery added 1.4 percent to $1,442.70 an ounce, the first advance in three sessions.
Palladium futures for September delivery jumped 2.9 percent to $744.65 an ounce, the biggest jump since July 1. The metal slumped 3.4 percent last week, ending a three-week rally.