Gold rebounded in London, extending an 11th annual gain, on speculation prices at a five-month low will spur demand from jewellers and investors.
Bullion fell 3.8% over the previous three days to the lowest level since July 6 as gains by the dollar against the euro curbed demand for the metal as an alternative investment.
Jewellery usage in India, the world's biggest buyer, rose 12% in 2011's first quarter from a year earlier, according to World Gold Council figures.
"January and February are usually good months in India, and a lower gold price might attract some buyers," said Marc Ground, a commodities strategist at Standard Bank in Johannesburg.
"While we haven't seen physical demand pick up yet, maybe people are anticipating it for next year."
Gold for immediate delivery climbed 1% to $1,561.48 an ounce by 10:09 a.m. in London, bringing the gain this year to 9.9%. The futures for February delivery rose 1.4% to $1,562.50 on the Comex in New York after a six-session slump, the longest since March 2009.
Holdings of gold in exchange-traded products are climbing for the first time in two weeks, according to data compiled by Bloomberg. Assets rose 0.3% this week after falling 1.5% the previous two weeks.
Silver slipped 0.1% to $27.66 an ounce, bringing the 2011 drop to 11%, the first decline in three years. Palladium climbed 0.7% to $630.50 an ounce, reducing the annual loss to 21%, the first retreat since 2008. Platinum advanced 0.7% to $1,379.25 an ounce. It's down 22% this year.
Source: www.economictimes.com
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DENIP Consultants Pvt Ltd
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