Gold shines amid concerns of liquidation

A sharp fall in the US dollar buoyed gold prices in early European markets yesterday, but heavy long positions accumulating in New York raised concerns of liquidation as bullion seemed to stall in its upward trend.

Spot gold was at $1,014.30 (Dh3,263.18) at 06.32GMT when compared with $1,013.80 an ounce late in New York on Tuesday, when it climbed 1.5 per cent to trade within striking distance of an 18-month high of $1,023.85 hit on Thursday.

Bullion touched an all-time high of $1,030.80 an ounce in March 2008.

Moving closer to an 18-month high struck last week, gold extended gains on Asian markets too. After the US dollar tumbled to its weakest in a year against the euro, the demand for the yellow metal has been increasing, but worries about heavy liquidation persisted.

Spot gold rose as high $1,017.80 an ounce before slipping to $1,016.75 by 0527GMT, still up $2.95 from New York's notional close and within striking distance of an 18-month high of $1,023.85 hit on Thursday. Gold has gone up as much as 16 per cent this year.

Silver price was hovering at $16.43 from $17.10, platinum at $1,300 from $1,332 and palladium at $289 from $300.

 

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