USD 63.8487

-0.37

EUR 70.5975

-0.34

BRENT

-64.68

AI-92 42.38

0

AI-95 46.11

0

AI-98 51.86

+0.01

Diesel 46.16

+0.01

18

Gold Comes Off Lows

Gold has rises off lows as the dollar slipped from a three-week high against the euro after...

Gold has rises off lows as the dollar slipped from a three-week high against the euro after comments by European Central Bank President Jean-Claude Trichet on a possible euro zone interest rate rise.

But gains remain capped by uncertainty over the future direction of the US currency and by expectations demand will remain muted going into the typically slack third quarter.

Spot gold was trading at $US873.60/874.60 at 0030 AEST, against $US878.30/879.70 an ounce late in New York on Wednesday.
Price volatility this year has made jewellers wary of buying gold, he said.

The precious metal slipped 1.4 per cent to an intraday low of $US865.45 earlier, its weakest level in three weeks, as the stronger dollar dampened interest in the precious metal as a currency hedge.

The euro touched a three-week low against the dollar, pressuring gold, while the US currency also reached its firmest level in three months against the yen.

Gold typically benefits from a softer dollar, as it is bought as a hedge against currency weakness.

The dollar had benefited this week from remarks made by Federal Reserve chairman Ben Bernanke on the worrying outlook for inflation.

His comments were widely taken to signal an end to the Fed's rate-cutting trend and led some analysts to speculate the dollar may have reached a turning point after months of decline.

A fall in the price of oil from the all-time highs it reached last month is also undermining support from gold. The precious metal benefits from rising crude prices, as it is often bought as a hedge against oil-led inflation.

The market is now eyeing U.S. non-farm payrolls data due out tomorrow, which are likely to lend fresh direction to the currency, for clues as to the future direction of trade, analysts said.