Gold held near a 2-1,5 month high as record energy costs and a declining dollar boosted demand for bullion as an alternative investment...
Gold held near a 2-1/2 month high as record energy costs and a declining dollar boosted demand for bullion as an alternative investment.
The precious metal tends to rise in tandem with oil as demand for an inflation hedge increases. Oil gained to a record $144.44 a barrel after a U.S. government report showed an unexpected decline in inventories.
Gold is ``benefiting from high oil prices and capital flows linked to ongoing U.S. dollar weakness,'' David Moore, commodity strategist at Commonwealth Bank of Australia in Sydney, said today in an e-mail.
Bullion for immediate delivery, which has gained 13 percent this year on rising oil prices and a falling dollar, was little changed at $943.72 an ounce at 9:42 a.m. in Singapore. Gold reached $946.08 July 1, the highest since April 18. Silver for immediate delivery fell 0.3 percent to $18.3275 an ounce.
The dollar traded near a two-month low against the euro as economists forecast the European Central Bank will raise its main refinancing rate by a quarter-percentage point and U.S. payrolls will drop for a sixth month. The currency stood at $1.5868 against the euro, compared with $1.5882 late yesterday in New York, and was at 106.03 yen from 105.91 yen.
The euro may weaken in the aftermath of the anticipated ECB rate hike, as the currency markets are likely to correct after recent euro strength, and ``this could weigh on gold prices,'' according to James Steel, an analyst at HSBC Securities in New York.
Gold for August delivery was down 0.2 percent at $944.80 an ounce in after-hours electronic trading on the Comex division of the New York Mercantile Exchange at 9:46 a.m. Singapore time.
Gold for June delivery on the Tokyo Commodity Exchange added 2 yen to 3,242 yen a gram ($951 an ounce) at the 11 a.m. local time break.