Gold Set for Fourth Weekly Gain as Dollar Weakens
Source: Bloomberg, Glenys Sim (10/23/09)
"Bullion is up 0.8% this week as Dollar Index. . .slid 0.8%."
Bullion is up 0.8% this week as Dollar Index, which tracks the greenback against the currencies of six trading partners including the euro and yen, slid 0.8%. Some investors buy gold as a hedge against a declining U.S. currency.
"Gold prices will continue to be influenced heavily by U.S. dollar movements," HSBC Securities analyst James Steel, wrote in a note e-mailed today. "Should the U.S. dollar weaken, gold is likely to remain well-bid."
Gold for immediate delivery traded at $1,060.32 at 10:56 a.m. Singapore time, after rising as much as 0.3% to $1,063.30 an ounce earlier. The metal reached a record $1,070.80 an ounce on Oct. 14. December-delivery gold was little changed at $1,060.90 an ounce on the Comex division of the New York Mercantile Exchange.
Thirteen of 25 traders, investors and analysts surveyed by Bloomberg, or 52%, said bullion would rise next week, as investors seek an alternative investment to a weakening dollar. Eight forecast lower prices and four were neutral.
The dollar tumbled to a 14-month low against the euro and is set for a third weekly drop ahead of reports that are forecast to show German business confidence increased and sales of existing U.S. homes rose. It was at $1.5029 per euro at 8:43 a.m. in Singapore, after reaching $1.5060 earlier, the weakest since August 2008.
Among other precious metals for immediate delivery, silver, platinum and palladium were all little changed at $17.68 an ounce, $1,367.50 an ounce and $336.75 an ounce, respectively.