Tags: gold | dollar | metals | commodities

Gold Rises 1.4 Percent on Physical Buying as Dollar Slips

Monday, 06 October 2014 03:33 PM

Gold rose 1.4 percent on Monday, its biggest one-day gain in two months, as the dollar's sharp retreat sparked fresh physical demand and short covering after bullion earlier hit a 15-month low, traders said.

Other precious metals rebounded broadly as the dollar's rally took a breather on profit-taking that emerged after Friday's jobs report reinforced the view the Federal Reserve would raise U.S. interest rates in mid-2015. The U.S. dollar index fell 0.8 percent.

Earlier on Monday, the yellow metal fell to its weakest since late June 2013, within reach of a four-year low at $1,180 an ounce. On Friday, gold entered into a correction phase, defined as a 10 percent drop from its most recent high at $1,345 reached in July.

"Gold's drop below $1,200 an ounce is sparking some more physical buying, especially from (Asia)," said Edmund Moy, chief strategist for California-based Fortress Gold, a provider of bullion-backed retirement accounts.

Spot gold rose 1.4 percent to $1,206.80 an ounce by 2:27 p.m. Eastern time, having earlier hit a 15-month low at $1,183.46.

U.S. COMEX gold futures settled up $14.40 at $1,207.30 an ounce in heavy trading volume.

On Friday, the dollar index soared over 1 percent after the Labor Department said U.S. hiring accelerated in September and the unemployment rate fell to a six-year low.

Stagnant Wages

Analysts noted, however, the report bore a large caveat in the form of persistently stagnant wages. Average hourly earnings actually slipped a penny last month.

"The spate of economic news has put downward pressure on gold, but the payrolls report might have painted a much better picture for the job market what it really is," Moy said.

The absence of top gold consumer China is weighing on the physical market, which usually sees a pick up in demand from jewelers and retail investors when prices fall.

China's financial markets, shut for a national holiday, will reopen on Wednesday. Markets in Singapore, a key bullion trading center in southeast Asia, were also closed for a public holiday.

Among other precious metals, platinum was up 1.7 percent at $1,236.10 an ounce, having earlier fallen to $1,183.25. The metal, mainly consumed as auto catalytic converters, slid 6.3 percent last week in its biggest weekly decline since December 2011.

Palladium rose 1.5 percent to $764.25 an ounce, having touched its lowest since late February at $732.75. The metal has dropped 17 percent from $910 last month, its biggest monthly decline since February 2011.

Silver climbed 2.9 percent to $17.26 an ounce after earlier hitting $16.66, its weakest since March 2010.

© 2019 Thomson/Reuters. All rights reserved.

   
1Like our page
2Share
Finance
Gold rose 1.4 percent on Monday, its biggest one-day gain in two months, as the dollar's sharp retreat sparked fresh physical demand and short covering after bullion earlier hit a 15-month low, traders said.
gold, dollar, metals, commodities
425
2014-33-06
Monday, 06 October 2014 03:33 PM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved