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BookmarkGold climbed in New York, after three weeks of gains, as the dollar’s decline spurred demand for an alternative asset and before U.S. Federal Reserve policy makers meet this week.
Bullion futures are up 9.1 percent this month, set for the biggest monthly gain since January 2012. July’s gain was driven by investors closing out bets on price drops and “opportunistic” buying from Asia, according to VTB Capital. The Bloomberg U.S. Dollar Index, a measure against 10 major currencies, was little changed after reaching a five-week low.
Gold tumbled 20 percent this year after some investors lost faith in the metal as a store of value and on speculation the Fed may curb its bond-buying program that helped bullion cap a 12-year bull run in 2012. 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. Fed policy makers begin a two-day meeting tomorrow.
Precious metals “have been supported by more dovish statements from the Fed in terms of quantitative-easing tapering alongside a weaker U.S. dollar,” Deutsche Bank AG analysts said today in a report. “However, we expect gold prices to remain vulnerable in an environment where the U.S. economy is set to accelerate during the remainder of this year and into 2014.”
Gold Price
Gold for December delivery rose 1 percent to $1,335 an ounce by 7:48 a.m. on the Comex in New York. Prices gained 2.2 percent last week. Futures trading volume was 13 percent above the average for the past 100 days for this time of day, according to data compiled by Bloomberg. Gold for immediate delivery in London was little changed at $1,333.93.
Gold exchange-traded product holdings fell to 1,969.9 metric tons on July 26, the lowest since May 2010, data compiled by Bloomberg show.
“There’s a raft of U.S. data coming out over the next few days,” said David Lennox, a resource analyst at Fat Prophets in Sydney. “Everyone will be looking at that to show if the U.S. economy is continuing along at some sort of growth rate.”
The U.S. central bank purchases $85 billion of Treasuries and mortgage debt each month. It has held the benchmark interest-rate target at zero to 0.25 percent since 2008 to support the economy. U.S. reports showing second-quarter gross domestic product are due July 31, while monthly employment data is due Aug. 2.
Silver for September delivery rose 1.5 percent to $20.07 an ounce in New York. Palladium for September delivery gained 0.6 percent to $728.50 an ounce. Platinum for October delivery was 1 percent higher at $1,436.80 an ounce.
